Face of Nation : The Coalition’s $158 billion tax cuts package has passed through the Senate with bipartisan support, meaning cash handouts are about to land in the bank accounts of about 10 million working Australians.
Here’s what it means for you.
More than 10 million workers will receive a tax offset to some degree, while around 4.5 million will score the full lump sum.
Under the package, all low and middle income earners making less than $126,000 a year will qualify.
Under the government’s proposal, a low and middle income earner tax offset will be doubled for the 2018/19 and 2019/20 financial years.
It means singles can get up to $1080, while dual-income households could net up to $2160 per year.
Use our tax cuts calculator to figure out exactly how much you can expect.
As early as next week, for those who have already lodged a tax return.
For the rest of us who are less organised, the payments will arrive over the coming months.It will show up automatically in your accounts — meaning you won’t need to do anything to claim it, even if you’ve already lodged your tax return before the package officially passes.
The Coalition’s tax package comes in three stages.
The first stage is a cash refund of up to $1080 after individual taxpayers file their tax return.
The second, aimed at fighting “bracket creep”, would raise the top limit of the 19 per cent tax bracket from $41,000 to $45,000 from 2022/23, while the low income offset would also be increased from $645 to $700.
Stage three involves dropping the 32.5 per cent tax rate to 30 per cent from July 1, 2024 — meaning all workers earning between $45,000 and $200,000 would be on the 30 per cent rate.
The Coalition claims that the package would mean an Aussie with an average taxable income of around $60,000 would be more than $15,000 better off over a decade.
The package took a while to be passed because Labor supported the first two stages — and wanted the second stage to be brought forward — it did not support the third, arguing the rollout date was too far off for the Parliament to decide on now.
But the Opposition abandoned its proposed amendments this afternoon saying its highest priority was “to get more money into the hands of more workers, sooner”.
The Coalition didn’t have the numbers to get it across the line themselves in the Senate, which has forced the Morrison government to negotiate with crossbench senators, including Jacqui Lambie and two from the Centre Alliance.
Centre Alliance has already declared its support for the package through a public statement.
“Supporting the tax cuts will reward Australian taxpayers and provide a stimulus to the economy that almost all economists have called for, including the Reserve Bank Governor,” the statement reads.
Independent senator Jacqui Lambie confirmed her support for the plan this morning, which means the Coalition has now clinched the support it needed to pass the package.
In return for her support, Ms Lambie wants Tasmania’s $157 million public housing debt to be wiped clean.
The debt was first racked up during the 1950s and 1980s when the Tasmanian government borrowed cash to fund public housing projects.
While the finer details of the deal are still being finalised, her support means the tax offset package is almost certain.
“I need those kids and their families off the streets in warm houses,” she told reporters, according to AAP.
“I’m not sitting around on this for another four or five weeks while we play argy bargy.”
