World News – UA – Budget to introduce instant tax cuts backdating changes


Millions of Australians will have more money in their pockets within weeks as the federal government makes two-year tax cuts

The CBA understands that tomorrow’s federal budget will confirm that tax cuts, which are expected to begin in July 2022, are postponed and backdated to July of this year

Under the plan, the upper limit of the 19% personal income tax bracket will be reduced from $ 37,000 to $ 45,000 and the 325% marginal tax rate will be reduced from $ 90,000 to 120,000 USD

The low and middle income tax compensation, which is payable to people with incomes over $ 37,000 and worth up to approximately $ 1,000, will also remain

Tax plan means people earning between $ 45,000 and $ 90,000 will receive an additional $ 1,080 this fiscal year

Workers earning over $ 90,000 will receive up to $ 2,565 more, while those earning over $ 120,000 will receive the maximum benefit

As part of the second stage of the tax plan already provided for by law, workers earning $ 85,000 would receive an additional $ 42 per fortnight A worker in $ 140,000 would receive an additional $ 99 per fortnight

Federal government hopes Australians will spend the extra money, to make up for lost economic activity due to international border closures, local COVID-19 closures and consumer caution

Treasurer Josh Frydenberg has previously explained why the government thinks offering tax cuts is a good idea

« We are looking at this question and the timing for these tax cuts because we want to stimulate aggregate demand, stimulate consumption, put more money in people’s pockets, and that’s one way to do it. do, « he said in July

But recent data shows households have saved more than usual due to uncertain times

In its pre-budget report, Deloitte Access Economics said the tax cuts were fair and that it was wise to push them forward, but wondered if people would spend the money.

The report also highlighted other effective stimulus measures such as infrastructure and generous unemployment benefits

Labor backs second stage of government tax cuts, but has yet to support third stage

« For the past few months, we’ve been saying we’re open to tax cuts for low and middle income workers, » Shadow Treasurer Jim Chalmers said

« We have expressed concerns about the third stage of income tax cuts, the third stage is the least responsible, the least affordable, the least fair and the least likely to be effective, as people with high income are not as likely to spend in the economy as workers with lower means « 

Think about your income During the past four years (before the “coronation”), did you receive regular pay increases? Our federal politicians were, writes Gareth Hutchens

One of Australia’s leading welfare groups has voiced opposition to tax cuts and called for other measures to be considered instead

Australian Council of Social Services chief executive Cassandra Goldie said more social assistance was needed which would help the economy instead

« Creating more jobs – a critical part of this is demand, it is consumer spending and every economist is very clear that the dollars provided to the lowest income people through the security payment system social security, job seekers and other key social security systems payments are the best spending the government can make when it comes to putting extra dollars in the hands of those who will spend them, ”a- she declared

JobSeeker’s payment is in place until the end of December and the government has announced that it will reassess the bi-monthly payment later this year, well after the budget is handed over

The final stage of the tax cut plan is expected to be introduced from July 2024 It would abolish the 37% marginal tax rate, creating a 30% tax rate for all money earned between 45,000 $ and $ 200,000

The CBA understands that tomorrow’s budget will not change the timing of the third stage, but the government may revisit the issue next May

This service may include material from Agence France-Presse (AFP), APTN, Reuters, AAP, CNN and BBC World Service which is copyrighted and may not be reproduced

AEST = Australian Eastern Standard Time, which is 10 hours ahead of GMT (Greenwich Mean Time)

Josh Frydenberg, Australian Federal Budget, Australia, Tax Cut

Global News – AU – Budget to introduce instant tax cuts backdating changes



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