Law Assignment

Q2 - Difference -

According to whether the taxpayer is a foreign resident or an Australian resident , the income tax
treatment applied to individual are different. An individual foreign resident will only be subject to
income tax on income sourced in Australia.In contrast, resident of Australia will be taxed on income
from all sources. Australian resident individual taxpayers are required to pay the Medicare levy except
foreign resident.Both resident and foreign resident individuals are subject at different rates. Foreign
resident access lesser personal tax compared to resident in Australia.Non- resident taxpayer even
enjoy special withholding tax rates.In addition, foreign resident do not get any benefit of the tax- free
threshlod or lower marginal tax rates yet Australia’s resident.

Q4. Recommendation -

In order to provide greater simplicity and transparency , a high tax-free threshold with a constant
marginal rate should be introduced. Income support such as scholarship and other supplementary
payments should be tax-exempt from tax treatment. Besides, due to costs associated with children,
family assistance should also be exempted from tax (Australia's Future Tax System n.d.). Individual or
families who are from low income, pensioner, senior Australians, and beneficiary tax offsets should be
removed from Medicare levy and structure tax offsets. The Medicare levy additional charge and
medical insurance should be subjected as a feature of tax and non-tax policies. Moreover, all form of
pay and wages for Australian resident ought to be assessable on an equivalent basis and without
exceptions (Australia's Future Tax System n.d.).

Reference :

1. Australia's Future Tax System: Final Report 2018, viewed 15 September 2018,
<http://taxreview.treasury.gov.au/content/finalreport.aspx?doc=html/publications/papers/final_rep
ort_part_1/chapter_12.htm>.

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