Treasurer dumps Labor taxation plans Joe Hockey's tax tweaks. Treasurer Joe Hockey has released the handbrake on Australian companies planning to expand overseas, boosted the prospects of educational institutions and removed an administrative headache facing super funds as part of spring clean of about 100 tax measures announced by Labor but gathering dust. Only 18 of the backlog of 96 tax measures are set to survive; 11 have been dumped, three partially dumped and 64 put out to consultation with the expectation they will be dumped. Mr Hockey and Assistant Treasurer Arthur Sinodinos will announce the result of the review by the end of the month. Pre-eminent among the measures dumped is a plan announced in May to abolish section 25-90 of the Income Tax Assessment Act to fight multinational profit shifting. Section 25-90 allows companies to deduct debt run up for the purpose of earning income overseas. Labor wanted it abolished as part of a suite of measures to ensure multinationals paid tax in Australia. The associated tightening of the so-called thin capitalisation rules will proceed as planned. Tax professionals say some Australian companies borrowing to legitimately expand overseas risked being caught by the change and were reconsidering their plans. "Many Australian companies have been relying on the provision in relation to legitimate offshore borrowing programs," said Steven Munchenberg, chief executive of the Australian Bankers Association. The association is pleased it will now continue. The Coalition has also scrapped Labor's plan to impose a $2000 annual cap on work-related self-education expenses. Universities Australia chief executive Belinda Robinson said the decision lifted "one of the most serious threats to Australia's productivity and competitiveness." Super funds will also be freed of an administrative headache that would have required them to impose a 15 per cent tax on fund earnings in excess of $100,000 a year during the drawdown phase. At the moment all earnings supporting retirement income streams are tax exempt. The plan was a face-saving compromise after a drawn-out battle with the industry and was set to bring in only $267 million over the next four years. "Not proceeding with this policy, alongside the government's commitment not to make any detrimental, unexpected changes during this parliamentary term, will deliver certainty," Association of Superannuation Funds chief executive Pauline Vamos said. However, an associated Labor plan that would have created a council of superannuation guardians will also now not see the light of day. As expected Labor's plan to tighten the fringe benefits applying to cars provided by employers has also been dumped. The changes will the cost the budget about $3 billion over four years.