The Government has now released exposure draft legislation amending the Income Tax Assessment Act 1997 and explanatory material for public consultation.

The exposure draft provides for a standard deduction of $500 for 2012-13, rising to $1,000 for 2013-14 and subsequent years. It will replace work-related expenses and the cost of managing tax affairs for those taxpayers whose claims for these expenses are less than the standard deduction. Taxpayers whose claims for these expenses exceed the standard deduction will still be able to claim those deductions.