Federal Budget 2019 – ‘immediate’ personal tax relief to boost spending
The Government has announced additional tax relief for Australians as part of its ‘Back in Black’ Federal Budget 2019 in a bid to ease the cost of living.
Having announced the Coalition Government’s ambitions to achieve $45bn surplus by 2023, Minister Josh Frydenberg proceeded to outline a Budget that would help support Australians and small businesses, create jobs and guarantee essential services “without increasing taxes”.
Frydenberg’s first Budget includes two main changes to personal income tax:
- The Government wants to double the low and middle income tax offset from 2018-19 (this financial year), meaning taxpayers earning up to $126,000 a year will receive a tax cut.
- And it aims to lower the 32.5 per cent tax rate to 30 per cent by 1 July 2024 for anyone earning between $45,000 and $200,000 per year.
Tax relief: Impacts for Australian families and business owners
In delivering the Budget, Frydenberg said these two measures will “deliver $158 billion of additional tax relief for hard-working Australians”, making them the “largest personal income tax cuts since the Howard Government”.
“The Government is more than doubling the low and middle income tax offset from 2018-19.”
This means a single income household would now expect to receive up to $1,080 per year (or $2,160 for dual income households).
In fact, the Government calculates that as many as 4.5 million taxpayers would receive the full offset amount, while a total of 10 million Australians will receive some benefit from it.
Better yet, it’s to be made available this financial year, which means the money can be delivered to taxpayers with their next return.
“This relief will flow quickly and be available to Australians after tax returns for the 2018-19 year are submitted in 13 weeks’ time,” said Frydenberg.
The news was welcomed by MYOB Chief Executive, Tim Reed, who said the personal tax cuts will be of clear benefit to consumers and Australian small businesses alike.
“The personal income tax cuts are welcomed as not only do personal income tax cuts provide much needed relief to household budgets, they stimulate the economy with small businesses right across the country benefiting from renewed consumer confidence to spend,” said Reed.
“We know that the type of measures introduced in the Budget tonight will encourage more people to start a business and for those already in business, to invest and create more jobs.”
Read more about the announcements made in Federal Budget 2019 right here.