New 30% minimum tax on trusts could cost small businesses thousands

A bill tabled in parliament seeks to levy a 30% minimum tax on discretionary trusts, a policy the government says targets tax structures that bypass ordinary labour income tax. Assistant Treasurer Daniel Mulino told a televised interview that the reform could impose compliance costs of a few thousand dollars on many small enterprises, with the total burden across the economy estimated at $50 million. He cited roughly 800,000 trusts, a figure that has doubled in the past quarter-century, as the basis for the calculation.

Critics from business organisations argue trusts are used for valid reasons such as safeguarding assets. The proposal faces opposition from the coalition, which has signalled it will not support the bill without substantial changes, leaving Labor to seek backing from either the coalition or the Greens to pass the legislation.