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Fed: Swan eats the rich

12 May 2009 7:35 PM

It looks like Labor had the wealthy firmly in its sights when formulating this year's budget.

The top income level for recipients of what's been termed middle-class welfare is now set at 150-thousand dollars .. and the budget's locked that in by pausing CPI indexation here for the next three years.

High-income individuals will no longer be able to offset deductions from non-commercial business activities again their incomes .. in a move targeting those with hobby farms and the like.

>From the 2009/10 financial year .. those earning more than 250-thousand dollars per year will instead have these excess deductions quarantined .. meaning they can only be offset against any future income from that business.

Businesses that own property .. such as real estate .. boats or planes .. and allow shareholders or associates to use these assets privately .. will now be subject to fringe benefits tax.

Those working overseas are also being targeted .. with any foreign income now subject to Australia's tax regime .. with an offset for any tax paid overseas.