The Government tonight unveiled the 2021-22 Federal Budget at Parliament
House in Canberra.
This year’s budget builds on the Government’s focus on job creation and
economic growth with the aim of securing the nation’s economic recovery on
the back of the COVID-19 induced downturn. The Budget looks to drive
further job creation to lower the unemployment rate, currently at 5.6 per
cent, down to below 5 per cent.
The Budget included a number of important announcements relevant to the
private capital industry which will help the sector and the businesses
backed by investment. These include:
- An effective tax rate of 17 per cent for income derived from Australian
medical and biotech patents through a new ‘patent box' regime that will
come into effect on 1 July 2022, with potential for the regime to be
expanded to clean energy innovation;
- A comprehensive review into the ESVCLP and VCLP programs in 2021;
- Implementation in July 2021 of a new ATO early engagement service
introduced to fast-track advice to foreign direct investors about proposed
transactions or relocating to Australia, such as FIRB approvals;
- Key changes to the Employee Share Scheme regime including an increase to
the value of shares that can be issued to an employee with simplified
disclosure requirements from $5,000 to $30,000 per employee per year; and
- Extension of the temporary full expense and the temporary loss carry-back
deductions for businesses.
Further detail on these and other announcements in the 2021-22 Federal
Budget which are relevant to the private capital industry and the business
sector are detailed below.