Labor wants to cap tax deductions for accountancy to $3000

Photo: Nigel Roddis/Getty Images

The Labor Party will limit the amount an individual can claim as a tax deduction for accountancy to $3000 when in government.

In his budget reply speech last night, Opposition leader Bill Shorten took aim at 48 Australians who earned more than $1 million in 2014-15, but paid no tax.

“Not even the Medicare levy,” Shorten said.

“Instead, using clever tax lawyers, they deducted their income down from an average of nearly $2.5 million… to below the tax-free threshold.”

The Labor leader claimed one of the biggest deductions they claimed was money paid to their accountants, which averaged $1 million.

“These individuals are not just counting cards in the casino – they are bringing their own dealer and their own deck. Loopholes for millionaires means middle Australia pays more,” he said.

“That’s why a Labor Government will cap the amount individuals can deduct for the management of their tax affairs at $3000.”

The policy was among a range of tax measures Shorten announced last night, including opposing the 0.5% increase in the Medicare levy to pay for the NDIS.

Labor wants to limit the increase to the top two tax brackets, so it only applies to people earning more than $87,000.

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