Archived April 2019 post covering the 2019-2020 Federal Budget. These were proposals at the time; some became law and others did not. Kept for reference only.
On 2 April 2019 the Federal Government handed down its Budget for the 2019-2020 financial year – the first delivered by Treasurer Josh Frydenberg and the last before that year’s federal election. The theme was ‘A stronger economy and a secure future’. Below are some of the announced measures that might have affected individuals. Remember these were proposals only, subject to passing Parliament and to any change of government.
Immediate tax cuts for low-to-middle income earners
The Low and Middle Income Tax Offset (LMITO), introduced the year before, was set to increase – the base rate rising from $200 to $255 and the maximum payment from $530 to $1,080, received after submitting a tax return. From 1 July 2022 both the LMITO and the Low Income Tax Offset were to be replaced by a single low-income tax offset.
Extension to personal income tax cuts
Over the following five years, income tax was to fall in three ways: the upper threshold for the 19% rate rising from $37,000 to $45,000; the 32.5% rate reducing to 30%; and the 37% bracket being abolished. The Government estimated 94% of taxpayers would pay 30% tax or less from 1 July 2024.
Medicare Levy low-income threshold
The Government proposed increasing the Medicare Levy low-income thresholds for singles, families, seniors and pensioners from the 2018-19 income year, so those below the thresholds would not be charged the levy.
Superannuation adjustments
Several super proposals aimed to help older Australians keep contributing: no work test for voluntary contributions by people aged 65 and 66; the bring-forward rule (up to $300,000 in a single year) extended to people under 67; and spouse contributions extended so the receiving spouse could be under 75 (with no work test at ages 65 to 66).
Social security, health and aged care
Other measures included a one-off Energy Assistance Payment ($75 for singles, $125 for couples) for social security pension recipients, higher Medicare rebates and improved access to diagnostic imaging, funding for 10,000 extra home care packages and 13,500 residential aged care places, and a $5.9 billion extension of the Commonwealth Home Support Programme to 30 June 2022.
Other measures
The Budget also proposed a $3.9 billion Emergency Response Fund for natural disasters, $525.3 million to modernise vocational training (including up to 80,000 new apprenticeships), a planned $5 billion over 10 years for the Medical Research Future Fund, $737 million for mental health, and an additional $2 billion for the Climate Solutions Fund.
General advice warning: This information is general advice only and does not take into account your individual circumstances, financial situation or needs. The figures and rules described reflect the law as it stood when the article was published and have since changed. Always seek current, personalised advice from a licensed adviser or registered tax agent before acting.