The Prime Minister has announced new tax cuts.
The following are changes to the Stage 3 tax cuts:
- Reduce the 19% tax rate to 16% (for incomes between $18,200 and $45,000).
- Reduce the 32.5% tax rate to 30% (for incomes between $45,000 and the new $135,000 threshold).
- Increase the threshold at which the 37% tax rate applies from $120,000 to $135,000.
- Increase the threshold at which the 45% tax rate applies from $180,000 to $190,000.
Therefore, following these announcements and assuming amending legislation is passed, the Australian resident personal income tax rates from 1 July 2024 will be:
| Resident individuals | |
| Up to $18,200 | Nil |
| $18,201 to $45,000 | 16% on part over $18,200 |
| $45,001 to $135,000 | $4,288 + 30% on part over $45,000 |
| $135,001 to $190,000 | $31,288 + 37% on part over $135,000 |
| $190,001 and over | $51,638 + 45% on part over $190,000 |
Treasury has provided a calculator of tax savings on their website. https://treasury.gov.au/tax-cuts/calculator
Changes to Medicare levy threshold
The Prime Minister addressed to the National Press Club today 25 January 2024, the Government plans to raise the threshold above which taxpayers are required to pay the 2% Medicare levy from the current $24,276 to $26,000.
Likewise, the threshold at which the levy phases-in will is proposed to be increased from $30,345 to $32,000.