This proposal would increase the Temporary Skilled Migration Income Threshold (the Income Threshold) and change the application charges and levies on the Temporary Skill Shortage visa (subclass 482). The levy would be equal to 3 per cent of the Income Threshold per visa per year for businesses with a turnover under $10 million per year, and 6 per cent of the Income Threshold per visa per year for businesses with a turnover of $10 million and above per year.

Under the proposal, the Income Threshold would be increased to $65,000, indexed with wage growth. The subclass 482 visa would no longer be separated into short‐term and medium‐term streams but would have a single stream of up to four years, with a pathway to permanent residency.  The annual migration intake would remain unchanged at the current level of 160,000.  The new visa application charge would be $2,455 per visa application, indexed with the consumer price index.  Currently, the visa application charge is $1,175 for the short‐term stream and $2,455 for the medium‐term stream.

The proposal would also abolish the component of the Skilling Australians Fund Levy that applies to subclass 482 visas, and replace it with a new yearly visa levy paid by employers who hire subclass 482 visa holders. The new levy would be calculated as a percentage of the Income Threshold, based on the size of the employer’s business, and would be deductible for company tax purposes. Consistent with the Skilling Australians Fund Levy, the proposed new visa levy will also be paid upfront.

Revenue from the Skilling Australians Fund Levy is currently appropriated for the Skilling Australians Fund to support ongoing vocational education and training.  Revenue from the new visa levy would continue to fund the Skilling Australians Fund at the current projected level, with any additional revenue collected returned to consolidated revenue.

The proposal would have effect from 1 July 2019.