New Director ID Requirement for Directors
From 1st November 2021 Company directors need to verify their identity as part of a new director identification number.
(Director ID) requirement by ASIC. A director ID is a unique identifier that a director will apply for once and keep forever.
All Australian company directors have until 30 November 2022 to apply for a Director ID (This also applies to Company Trustees of Self-Managed Super Funds).
No changes to the currently legislated personal income tax arrangements. Stage three tax cuts for 2024 will still come into effect, the 37% marginal rate for those earning over $120,000 will be eliminated. For those earning between $45,000 and $200,000, the 32.5% tax rate will decline to 30%. The top tax bracket (45%) will now apply at $200,000, not $180,000.
The $1,500 LMITO (Low and Middle income tax offset) has been allowed to lapse. This was a $1,500 tax rebate for those on incomes up to $126,000 and was introduced back in 2018.
The Government will allow more people to make downsizer contributions to their superannuation, by reducing the minimum eligibility age from 60 to 55 years of age. The measure will have effect from the start of the first quarter after Royal Assent of the enabling legislation. This was a pre-election announcement.
The downsizer contribution allows people to make a one-off post-tax contribution to their superannuation of up to $300,000 per person from the proceeds of selling their home. Both members of a couple can contribute, and contributions do not count towards non-concessional contribution caps.
Lifting the income threshold for the Commonwealth Seniors Health card from $61,284 to $90,000 for singles and from $98,054 to $144,000 (combined) for couples.
Cheaper childcare.
Paid parental scheme to have greater flexibility for families from 1 July 2023.
$9.6 billion toward several nationally significant infrastructure projects including:
Freight highway upgrades: $1.5 billion allocated for upgrading important highways that facilitate freight including the Tanami, Dukes, and Augusta highways, among others.
Suburban Rail Link in Victoria: $2.2 billion for the rail system that will connect every major rail line (and the airport) together in Victoria.
Electrification of public transport in WA: $670 million to manufacture more electric powered buses and battery charging technology in WA.
Western Sydney roads: $300 million for the development of road linkages in Western Sydney to foster efficient travel of passengers and freight before the new airport opens in 2026.
NBN: A $2.4 billion investment into the NBN to extend the network to 1.5 million more homes.
The Government will cut taxes on electric cars so that more Australians are able to afford them.
From 1 July 2022, the measure will exempt battery, hydrogen fuel cell and plug-in hybrid electric cars from fringe benefits tax and import tariffs if they have a first retail price below the luxury car tax threshold for fuel-efficient cars ($84,916 in 2022‑23). The car must not have been held or used before 1 July 2022.
Employers will need to include exempt electric car fringe benefits in an employee’s reportable fringe benefits amount.
The decision to scrap the off-market buyback is not all that surprising.
Large companies that possess significant surplus franking credits would offer to buy back investors’ stock. The breakdown of the off-market buybacks were of the total amount paid to the shareholder, an artificially low capital component (which was well and truly picked up by the tax department and modified accordingly) and an inflated dividend component which enabled the distribution of the excess franking credits.
Well, no more.
It was a smart strategy when originally devised some years back, but much of the juice was squeezed out by the ATO when they tinkered with it, rendering it attractive to non-tax paying and low tax paying entities, at best.
It will impact Whitehaven’s (WHC) current capital management initiatives who were conducting both an on market and an off market buyback and will see them most likely paying large special dividends instead of the off market component.
On Tuesday this week the market fell to its lowest point in 4 months, the next day enjoyed its best day this year, then got smacked again on Friday. Volatility is back. In summary, the market fell 167 points or 2.3% for the week.
Energy prices have replaced Evergrande on the front page of business papers this week - that was of course up until the only adult in State politics fell on her sword and resigned-. The oil price hit US$80/barrel for the first time in 3 years, gas prices have risen to US$30 plus per unit and thermal coal hit a high of US$218/tonne.
The announcement by the Federal Government that they will be scrapping the previous agreement with the French (that is a decade behind schedule mind you) to the new nuclear-powered (and capable?) submarine fleet seems innocuous enough, but it’s all linked.
The US, UK and Australia (now a new acronym of AUKUS) are formalising a strategic security pact for the Indo Pacific region to cooperate in the development of a host of new tech defence systems including AI, hypersonic missiles and cyber weapons.
In a bit of a topsy turvy week the market fell 116 points or 1.6%. Iron ore and gold keep falling, coking and thermal coal keep rising (coking coal at a 5-year record), and now thanks to a coup in Guinea, bauxite and alumina are rising with another 15% pop last night. Guinea is a major global bauxite supplier and accounts for around 55% of Chinese supply. This rise in the price of bauxite (the base ore used for aluminium extraction and refining) is good for Alumina (AWC) and South 32 (S32).
The market seems to be reconciling lower growth expectations at the moment, which in my view is entirely justifiable.
Well despite being locked up for the best part of the last two years, and soon to be subjected to the longest lockdown in the world, our rate of infections are escalating at a faster rate than that of our Northern counterpart where lockdowns were put off for as long as possible and weren’t as severe nor broadly applied. And closing playgrounds, I know they’ve backflipped on this but honestly. Hell we went into lockdown 24 hours after the Premier smugly bragged about his doughnut day.
The market limped 27 points higher to 7488 this week and there were plenty more results through. They’ll continue thick and fast until the end of the month. Amidst this white noise of figures, there are some interesting results being released.
The big news this week was the Woodside Petroleum/BHP Petroleum tie up which I’ll get onto later in the report. But the oil and gas space is already consolidating here; first Santos and Oil Search getting together, now Woodside is buying BHP’s Petroleum division. Is Beach Petroleum at risk of takeover?
The market slipped for the first time this week since early July, falling 2.2% to 7461. Australia’s unemployment rate fell from 4.9% to 4.6%, but the participation rate also fell marginally from 66.2% to 66% and underemployment rose from 7.9% to 8.3%.
On a seemingly unstoppable roll, the market rose another 1.2% this week rising to 7629. In the US their reporting season has nearly come to a close, producing some exceptional results with 87% of the S&P 500 beating earnings expectations and providing encouragement and justification to buyers. I doubt this can continue.
Locally, insurers Suncorp, QBE and IAG made large profits because they’ve increased premiums pretty aggressively and no one can do anything so claims aren’t being triggered. Elsewhere commodity prices roll on like ocean swell, iron ore falling to $160/tonne and coal continuing its rise.
The market continued on its steady rise, up a full 2% this week. The big miners suffered a little, banks and healthcare were strong, but the big move came from a company that didn’t even exist seven years ago.
Inflation concerns returned in the US this week, initially setting the tone for global markets. Our market looked to be substantially weaker, but the now regularly recurring buying strength returned, resulting in the ASX200 rising 0.6%.
We are in the midst of a large number of quarterly and half yearly reports being released so I’ll cut straight to it.
No point talking about it really, in we go again.
The ASX200 rose 1% in another scrambly sort of a week; directionless but still ended up. Incredibly unemployment dropped again, this time to 4.9%. The actual number of unemployed dropped by 22,000 to 679,000. The participation rate remained steady at 66.2% and underemployment (those seeking more work than they have) increased by 0.5% to 7.9%.
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