Beijing targeted Australia to send warning to US, says Morrison
In a rare appearance for a former foreign leader in front of a congressional committee, Morrison warned on Wednesday (Thursday AEST) that the Chinese Communist Party has taken advantage of its growing economic power since the 1990s to build capacity to challenge the global order.
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West Australian
17 minutes ago
- West Australian
Nick Bruining: Savings bonds are back to dodge $3m super tax whack, but they're not just for the wealthy ...
With legislation to enact the new extra 15 per cent tax on superannuation balances over $3 million about to be debated, attention is turning to alternative investment vehicles which can be used by anyone, not just the wealthy. Older-style savings bonds are set to make a comeback with the simplicity and flexibility of a public offer superannuation fund, coupled with early access to tax-free savings. Saving bonds were at the heart of life insurance savings plans sold heavily in the 1980s and 90s. Unlike the fee-hefty offerings that paid financial advisers handsome commissions back then, current versions are low-fee and commissions are now banned. In a similar way to superannuation funds, investors using these tax-paid bonds see the bond provider deduct tax on the earnings of the fund and send that tax to the Australian Taxation Office. The tax rate is 30 per cent on the earnings of the fund. But unlike the proposed tax on super balances above $3m, the tax is only payable on actual earnings and realised capital gains of the fund. One of the major criticisms of the new super tax is that the extra 15 per cent is payable on unrealised gains and is levied against the individual. Members are likely to be able to elect to have the tax deducted from their super fund, but that assumes the fund has the liquidity on hand to provide the cash. That might not be the case with some self-managed superannuation fund arrangements. The 30 per cent tax rate with a savings bond is the same rate of marginal tax that someone pays when they earn between $45,000 and $135,000. But unlike personal tax, there's no Medicare levy payable, meaning investors in that income range save at least 2 per cent. It also means that it may not be tax-efficient for those investors earning less than $45,000 a year because the maximum tax they would pay is 18 per cent, including Medicare. If the savings bond is held for at least 10 years, all of the proceeds can be withdrawn tax-free. There are no age restrictions on when the money is invested or accessed. Even if you access the money before 10 years, the invested amount is returned tax-free with the earnings of the fund taxable — but coming with a 30 per cent tax offset or credit. From year eight, two-thirds of the earnings are taxable and if accessed in year nine, only one-third is taxable. Like super, if you access the bond because of death, severe financial hardship or disability, no tax is payable whenever you access the capital and earnings. Also like super, the money in a savings bond is generally not accessible to bankruptcy trustees if your personal financial position crashes. One important point to note: Unlike imputation or franking credits attached to Australian share dividends, if you access the earnings early, any unused tax credits are not refunded. There are no initial contribution limits but to stop people rorting the system and loading up a savings bond just prior to the 10-year tax-free requirement being met, limits apply. These are based on the previous year's contribution and restrict the amount invested to 125 per cent of the previous year's contribution. For example, someone who invests $10,000 in year one, could put in $12,500 in year two and $15,625 in year three. If they missed year four, they would have to start a new savings bond in year five. Investors have a similar range of investment choice to public offer super funds. That means shares, property, fixed interest and cash. The 10-year long-term nature of savings bonds means that most investors could realistically use long-term growth investments such as shares or property to enhance the likely return. The other point to remember is that the number of companies offering savings bonds is limited. This is because only Australian Prudential Regulation Authority-regulated and registered life insurance companies and friendly society firms can offer them. While the invested money is not guaranteed, investors benefit from the tight supervision the watchdog imposes on registered organisations. Unlike a SMSF scheme, the entity operating this type of fund cannot be set up by an individual. Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association
Perth Now
an hour ago
- Perth Now
Major step towards cutting maximum medicine cost to $25
Australians will pay no more than $25 for selected medicines for the first time in more than 20 years under a proposal to be brought before parliament. It will be the second cap on medicines on the Pharmaceutical Benefits Scheme (PBS) introduced by the Albanese government in three years, after it cut the maximum price of PBS prescriptions from $42.50 to $30. "The size of your bank balance shouldn't determine the quality of your health care," Prime Minister Anthony Albanese said. "My government will continue to deliver cost-of-living relief for all Australians." PBS medicines would be capped at $7.70 for pensioners and credit card holders until 2030. The bill's introduction is largely a formality, with its passage through the lower house all but assured thanks to Labor's massive 94-seat majority in the 150-seat House of Representatives. The election promise is the Albanese government's next priority after it introduced childcare safety and HECS debt reduction legislation. Federal Labor has been talking up plans to strengthen the PBS amid concerns the scheme will be targeted as a bargaining chip in US trade negotiations to ward off threatened pharmaceutical tariffs. Mr Albanese has repeatedly said the scheme was not up for negotiation. Australia eased its biosecurity restrictions on US beef imports last week, but the prime minister has denied the move was linked to US trade talks, noting it followed a 10-year review of Australian biosecurity rules. Beyond new legislation, conflict in the Middle East will likely prompt fierce debate on the parliamentary floor after Mr Albanese said Israel had breached international law by blocking the flow of food aid into Gaza. "Quite clearly, it is a breach of international law to stop food being delivered, which was a decision that Israel made in March," Mr Albanese said on ABC's Insiders program on Sunday. He stopped short of saying Australia would join France in recognising a Palestinian state, but said his government would decide at "an appropriate time". "Hamas can have no role in a future state," he said. "Hamas are a terrorist organisation who I find, their actions are abhorrent." Opposition foreign affairs spokeswoman Michaelia Cash said Mr Albanese failed to adequately condemn the role of the group in the ongoing conflict. The government is also likely to come under pressure regarding transparency when parliament resumes, after a Centre for Public Integrity probe revealed only a quarter of freedom of information request responses returned by the government in 2023-24 were un-redacted. By comparison, the Morrison government returned almost half of its FOI requests as complete documents in 2021-22.
West Australian
an hour ago
- West Australian
Major step towards cutting maximum medicine cost to $25
Australians will pay no more than $25 for selected medicines for the first time in more than 20 years under a proposal to be brought before parliament. It will be the second cap on medicines on the Pharmaceutical Benefits Scheme (PBS) introduced by the Albanese government in three years, after it cut the maximum price of PBS prescriptions from $42.50 to $30. "The size of your bank balance shouldn't determine the quality of your health care," Prime Minister Anthony Albanese said. "My government will continue to deliver cost-of-living relief for all Australians." PBS medicines would be capped at $7.70 for pensioners and credit card holders until 2030. The bill's introduction is largely a formality, with its passage through the lower house all but assured thanks to Labor's massive 94-seat majority in the 150-seat House of Representatives. The election promise is the Albanese government's next priority after it introduced childcare safety and HECS debt reduction legislation. Federal Labor has been talking up plans to strengthen the PBS amid concerns the scheme will be targeted as a bargaining chip in US trade negotiations to ward off threatened pharmaceutical tariffs. Mr Albanese has repeatedly said the scheme was not up for negotiation. Australia eased its biosecurity restrictions on US beef imports last week, but the prime minister has denied the move was linked to US trade talks, noting it followed a 10-year review of Australian biosecurity rules. Beyond new legislation, conflict in the Middle East will likely prompt fierce debate on the parliamentary floor after Mr Albanese said Israel had breached international law by blocking the flow of food aid into Gaza. "Quite clearly, it is a breach of international law to stop food being delivered, which was a decision that Israel made in March," Mr Albanese said on ABC's Insiders program on Sunday. He stopped short of saying Australia would join France in recognising a Palestinian state, but said his government would decide at "an appropriate time". "Hamas can have no role in a future state," he said. "Hamas are a terrorist organisation who I find, their actions are abhorrent." Opposition foreign affairs spokeswoman Michaelia Cash said Mr Albanese failed to adequately condemn the role of the group in the ongoing conflict. The government is also likely to come under pressure regarding transparency when parliament resumes, after a Centre for Public Integrity probe revealed only a quarter of freedom of information request responses returned by the government in 2023-24 were un-redacted. By comparison, the Morrison government returned almost half of its FOI requests as complete documents in 2021-22.
