On May 14, 2024, Treasurer Jim Chalmers unveiled the Federal Government’s 2024-25 Budget, a comprehensive plan to alleviate the cost of living for Australians amidst economic challenges. Let's delve into the key measures:
Introduction
The 2024-25 Federal Budget, dubbed a "responsible budget" by Treasurer Chalmers, focuses on tax cuts and cost-of-living alleviation. It aims to balance assistance with living expenses in a slowing economy while mitigating inflation. Proposed measures are subject to change during implementation. Here's a detailed breakdown:
Tax
The Government reaffirmed tax cuts benefiting 13.6 million taxpayers from July 1, 2024. Notable changes include reducing the 19% tax rate to 16% and the 32.5% tax rate to 30%. Income thresholds for the 37% and 45% tax rates will increase to $135,000 and $190,000, respectively. For example, a taxpayer earning $50,000 could save $929 in taxes annually.
Social Security
The freeze on deeming rates has been extended until June 30, 2025, benefiting approximately 876,000 income support recipients, including 450,000 Age Pension recipients. Carer Payment recipients will enjoy increased flexibility in structuring work commitments, and adjustments to JobSeeker Payment and Rent Assistance aim to provide better support.
Aged Care
To address the demand for Home Care Packages, an additional 24,100 packages will be allocated in 2024-25, reducing wait times in the National Priority System. For example, the estimated wait time for a person with medium priority entering the system on March 31, 2024, ranges from less than 1 month for Level 1 to 9-12 months for Level 3.
Cost of Living
Energy bill relief measures include rebates of $300 for households and $325 for small businesses, effective from July 1, 2024. About 3 million Australians with student loans are set to receive an average reduction of $1,200 in their HELP or HECS debt. Additionally, a temporary freeze on Pharmaceutical Benefits Scheme co-payments is proposed.
Superannuation
Superannuation will apply to Paid Parental Leave, with contributions set at 12% of the PPL rate. Legislative updates include increases in various superannuation caps and thresholds effective July 1, 2024.
In conclusion, the 2024-25 Federal Budget aims to provide targeted relief and support, with a focus on promoting financial stability and improving social welfare.
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