The Albanese Government recognises the economic realities of 2024: Australians are under pressure right now and deserve tax cuts.
It has been announced that The Albanese Labor Government is delivering a tax cut. This is for every Australian taxpayer to provide targeted cost of living relief, for broader and better” outcomes.
These new tax cuts are designed to provide bigger tax cuts for middle Australia. Set to make a real difference to 13.6 million taxpayers. Mr Albanese states these changes will help with easing the cost of living. All whilst making the system fairer and boosting workforce participation.
“Our plan will more than double the benefit for Australians on the average income. And it will look after low-income earners and part-time workers as well,” Mr Albanese said.
From 1 July 2024, the Albanese Labor Government has proposed:
- Reduce the 19 percent tax rate to 16 percent (for incomes between $18,200 and $45,000).
- Reduce the 32.5 percent tax rate to 30 percent (for incomes between $45,000 and the new $135,000 threshold).
- Increase the threshold at which the 37 percent tax rate applies from $120,000 to $135,000.
- Increase the threshold at which the 45 percent tax rate applies from $180,000 to $190,000.
These proposed changes would result in the following:
- All 13.6 million taxpayers will receive a tax cut – and 2.9 million more taxpayers will receive a tax cut compared to Morrison’s plan.
- 5 million taxpayers (84 percent of taxpayers) will now receive a bigger tax cut compared to Morrison’s plan
- 8 million women (90 percent of women taxpayers) will now receive a bigger tax cut compared to Morrison’s plan.
- A person with an average income of around $73,000 will get a tax cut of $1,504 – that’s $804 more than they were going to receive under Morrison’s plan.
- A person earning $40,000 will get a tax cut of $654 – compared to nothing under Morrison’s plan.
- A person earning $100,000 will get a tax cut of $2,179 – $804 more than they would receive under Morrison’s plan.
- A person earning $200,000 will still get a tax cut, which will be $4,529.
- The Government will increase the Medicare levy low-income thresholds for 2023-24.
Proposed Changes Summarised
| 2023-24 |
2024-25 |
| Thresholds ($) |
Rates (%) |
Thresholds ($) |
Rates (%) |
| 0 – 18,200 |
Tax-free |
0 – 18,200 |
Tax-free |
| 18,201 – 45,000 |
19 |
18,201 – 45,000 |
16 |
| 45,001 – 120,000 |
32.5 |
45,001 – 135,000 |
30 |
| 120,001 – 180,000 |
37 |
135,001 – 190,000 |
37 |
| Over 180,000 |
45 |
Over 190,000 |
45 |
Geelong Accounting
The proposed changes outlined in this blog will necessitate legislative changes, therefore the implementation of these changes into legislation remains uncertain.
As you prepare for your next tax return, it’s always advisable to consult with a tax accountant or use a reliable tax calculator to understand the changes and accurately estimate your tax obligations. Staying informed about tax policy updates is crucial to ensure compliance.
The expertise and experience of our Geelong Accountants at The Hrkac Group can help you with any tax return enquiries you may have.
To make an appointment to meet with one of our friendly Geelong Accountants, contact us via email or phone (03) 5224 2366.
This information has been provided as general advice. We have not considered your personal or financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication.
