CRAIG’S
position
ON THE
ISSUE
“The importance of family unites our community in Reid in a way that no other issue can. From Drummoyne to Auburn and all points in between, it’s so often all about our families.”
- Craig Laundy MP

The Coalition believes that government can do more to reduce the financial burden of families.

One way that we’re doing this is by providing tax relief and making income tax lower, fairer and simpler.

The Coalition also recognises the importance of affordable childcare and education for families in Reid, and you can learn more about how our recording spending in education will benefit families by clicking here.

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THE
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Income Tax Relief

To encourage and reward working Australians, we are making income tax lower, fairer and simpler.

Our plan will mean working Australians keep more of their money, to help pay their bills, save for their future or spend with local businesses – which in turn helps our economy.

Our plan is affordable. It will be legislated now, but implemented over seven years in three steps.

It will provide tax relief now for lower and middle income earners. Over time, it will provide lower, simpler and fairer taxes for all taxpayers.

Step 1: Immediate Tax Relief for Low and Middle Income Earners 

The first step will deliver tax relief to low and middle income earners to help with cost of living pressures.

The low and middle income tax offset will provide tax relief of up to $530 to low and middle income earners for the next four years.

The offset will assist over 10 million Australians and around 4.4 million people will receive the full $530 benefit for 2018-19.

Over the four years, they will get the tax relief at the end of each year as part of completing their tax return.

The benefit is in addition to the existing low income tax offset, and will be available on assessment after a taxpayer lodges their tax return.

Step 2: Lifting Brackets to Protect Taxpayers from ‘Bracket Creep’

The second step expands tax relief to help protect middle income earners from bracket creep.

In other words, it ensures that as inflation and incomes rise, workers won’t get pushed into higher tax brackets and pay a higher percentage of their income in tax.

From 1 July 2018, the Government will provide a tax cut of up to $135 per year to around 3 million people by increasing the top threshold of the 32.5 per cent tax bracket from $87,000 to $90,000.

When the low and middle income tax offset concludes in 2021-22, the benefits will be locked in by increasing the top threshold of the 19 per cent tax bracket from $37,000 to $41,000 and increasing the low income tax offset from $445 to $645 from 1 July 2022.

From 1 July 2022 the top threshold of the 32.5 per cent tax bracket will be increased from $90,000 to $120,000, providing a tax cut of up to $1,350 per year.

Step 3: Making Personal Taxed simpler and flatter

The third step finalises the Government’s plan for more Australians to pay less tax by making the system simpler.

From 1 July 2024, the Government will increase the top threshold of the 32.5 per cent tax bracket from $120,000 to $200,000, removing the 37 per cent tax bracket completely.

The plan means that around 94 per cent of all taxpayers are projected to face a marginal tax rate of 32.5 per cent or less in 2024-25. This compares with a projected 63 per cent of taxpayers in 2024-25 without change to current settings.

Australians who work hard, take extra shifts, or earn pay rises or promotions will be encouraged and rewarded.  Workers can plan ahead, knowing they will pay one consistent rate of income tax.

Under our plan, Australia’s tax system will be internationally competitive, reward effort, and underpin a strong economy.

Visit the Tax Relief Calculator at www.budget.gov.au  to find out how you will benefit.

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