Personal Income Tax Cuts Confirmed
As previously announced, the Government has confirmed tax cuts for Australian taxpayers and it will come into effect from 1 July 2024. With the redesigned tax cuts, individuals can benefit from these cuts as more focus will be on individuals with taxable income below $150,000.
Medicare Levy Low-Income Thresholds Increase
The Medicare levy low-income thresholds will be maximised for singles, families, seniors and pensioners from 1 July 2023.
| Medicare low income threshold | Threshold as at 30 June 2023 | Threshold from 1 July 2023 |
| Singles | $24,276 | $26,000 |
| Families | $40,939 | $43,846 |
| Single – seniors and
pensioners |
$38,365 | $41,089 |
| Family – seniors and
pensioners |
$53,406 | $57,198 |
| Family – for each
dependent child or student |
$3,760 | $4,027 |
$300 Energy Relief for Households
A $300 energy bill rebate will be given to households. $325 energy relief will also be offered to eligible small businesses. Costing $3.5bn over three years from 2023-24, the measures expand the Energy Bill Relief Fund.
Capping Indexation of HELP Debts
The government caps the HELP indexation rate to be lower of either the Wage Price Index (WPI) or the CPI from 1 June 2023. The change will apply to all HELP, Australian Apprenticeship Support Loans, VET Student Loans, and other student support loan accounts that existed on 1 June 2023.
With changes in the calculation of HELP indexation from 1 June 2023, the indexation rate is minimised from:
- 7.1% to 3.2% in 2023, and
- 4.7% to around 4% in 2024.
This change has solved an issue for over 3 million Australians with a HELP debt when the CPI indexation rate increased to 7.1% last year. With $26,500 as an average HELP debt, an individual will notice around $1,200 wiped from their outstanding HELP loans this year, pending the passage of legislation.
Estimated Indexation for HELP Debts
| HELP debt at 30 June 2023 | Total estimated credit for 2023 and 2024* |
| $15,000 | $670 |
| $25,000 | $1,120 |
| $30,000 | $1,345 |
| $35,000 | $1,570 |
| $40,000 | $1,795 |
| $45,000 | $2,020 |
| $50,000 | $2,245 |
| $60,000 | $2,690 |
| $100,000 | $4,485 |
| $130,000 | $5,835 |
Superannuation on Paid Parental Leave
Super will be paid on Paid Parental Leave payments from 1 July 2025. An additional payment will be received by eligible parents, based on the superannuation guarantee as a contribution to their super fund. An extra two weeks of leave (22 weeks total) will be provided which will increase to 24 weeks from July 2025 and 26 weeks from July 2026.
Increasing Commonwealth Rent Assistance
From 20 September 2024, the Commonwealth rent assistance rates will increase by 10%. Recipients of Centrelink/Department of Veterans Affairs payments and those receiving family tax benefits may also get rent assistance if they pay rent or other rent-like payments over a minimum fortnightly threshold. $188.20 for a single person and $177.20 combined for the couple, these are the current maximum fortnightly rates.
Improving Aged Care Support
Funding of $2.2bn will be provided by the government over the next 5 years to provide key aged care reforms and implement recommendations from the Royal Commission into Aged Care Quality and Safety. An additional 24,100 home care packages will be released in 2024-25. The Government has also agreed to postpone the start date of the new Aged Care Act to 1 July 2025.
Increased Flexibility for Carer Payment
Currently, to receive the Centrelink Carer Payment, the caregiver must not be involved in work, training or study for over 25 hours per week. The caregiver must provide the care recipient with ‘constant care’. The current 25 hours per week will be amended to 100 hours over four weeks from 20 March 2025. It will only apply to employment and will not capture volunteering, study, and travel time.
Higher Rate of JobSeeker for Partial Capacity to Work
There will be an extension to the eligibility for the current higher rate of JobSeeker payment to single recipients with partial capacity to work (0 to 14 hours per week) from 20 September 2024. A higher rate of payment is received by those on JobSeeker payments aged 55 or above and who have been on payment for 9 continuous months.
These are:
| Relationship status | Maximum payment per fortnight |
| Single with no children | $762.70 |
| Single with dependent children | $816.90 |
| Single 55 or older after 9 continuous months of payments | $816.90 |
| Partnered (Each) | $698.30 |
Freezing Social Security Deeming Rates
A deemed rate of return depending on the aggregated value of these investments is assumed when calculating Centrelink and Department of Veterans Affairs payments, rather than working out the actual income from financial investments. The Government is likely to freeze the deeming rates (shown below) until 1 July 2025:
| Deeming rate | Single | Pensioner Couple |
| 0.25% | Up to $60,400 | Up to $100,200 |
| 2.25% | Amounts over $60,400 | Amounts over $100,200 |
Pharmaceutical Benefits Scheme Co-Payments
By freezing indexation, the government will ensure to keep the cost of medicines low:
- The co-payments for PBS general medications will not be indexed between January 1, 2025, to December 31, 2025. Indexation will resume on January 1, 2026.
- The co-payments for PBS concessional medications will not be indexed between January 1, 2025, to December 31, 2029. Indexation will resume on January 1, 2030.
The optional $1 discount for subsidised prescriptions will be gradually reduced each year by the relevant notional indexation amount until it reaches zero. Starting from January 1, 2024, the maximum co-payment for most PBS medicines will be $31.60, or $7.70 if you have a concession card. The Australian Government will cover the remaining cost, except for brand premiums and certain other allowable charges.
Federal, State and Territory Governments Focus on Housing
Housing initiatives identify three key areas:
- Private commercial development of future housing supply – the government has decided to build 1.2 million homes by the end of the decade. New measures announced within the 2023-24 budget to encourage investment and development of housing, especially build-to-rent developments. However, draft legislation allows the announced incentives that have recently been released by the Treasury. No new measures have been announced to date.
- Support to help ease the path to home ownership for first home buyers – also a policy dominant in the 2023-24 Budget with $5.5bn over a decade committed to the Help to Buy scheme. There are no new incentives have been announced to date.
- Crisis and social housing support – a $1bn will be used according to the government for crisis and transitional accommodation for women and children fleeing domestic violence, and youth. This is 15% increase to Commonwealth Rent Assistance in the 2023-24 Budget.
New measures include:
- $1bn for states and territories to build the roads, energy, sewers, water and community infrastructure; and
- A new $9.3 billion 5-year National Agreement on Social Housing and Homelessness – for states and territories to cope with homelessness, provide crisis support and build and repair social housing. This includes doubling Commonwealth homelessness funding to $400 million each year, matched by states and territories.