Government’s Tax Cuts to Benefit Australian Taxpayers

Government’s Tax Cuts to Benefit Australian Taxpayers

To provide relief to Australians for the increased cost of living, the Government has introduced significant tax cuts to take effect from 1 July 2024.

Key changes include:

     1. Reducing the 19% tax rate to 16%

     2. Reducing the 32.5% tax rate to 30%

     3. Increasing the threshold for the 37% tax rate from $120,000 to $135,000

     4. Increasing the threshold for the 45% tax rate from $180,000 to $190,000

The changes put $804 more in the pocket for those at the lowest tax bracket, plus $2,250 for those earning $135K, and another $800 for those that are on 190K salary.

It is estimated that these changes will benefit 13.6 million taxpayers will receive the tax cuts, 2.9 million more than the previous plan.

Additionally, the government will increase the Medicare levy low-income thresholds, aimed at providing assistance to over a million Australian low-income earners.

The Medicare Levy thresholds have been increased with immediate effect for the 2024 year, as follows:

     1. Individual income threshold: $26,000

     2. Family income threshold: $43,846

     3. Individual eligible for the SAPTO: $41,089

     4. Families eligible for the SAPTO: $57,198

     5. Child-student component for families is $4,027

Overall, these tax cuts are expected to cost $1.3 billion over the forward estimates, while the increase in Medicare levy thresholds will amount to $640 million over four years.

 

Source: Australian Taxation Office

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Disclcaimer: The information provided within this article is general information only.  None of the comments in these notes are intended to be advice, whether legal, financial product or professional. You should obtain specific advice regarding your particular circumstances from a tax or legal professional.

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