Support for Individuals
The Government is taking steps to help alleviate the burden of increasing living costs by providing $1.5 billion over two years for electricity bill relief, benefiting more than 5 million households and 1 million small businesses. Eligible families can receive up to $500, while small businesses can receive up to $650. There will be no changes to personal tax rates in 2023-24, but the stage three tax cuts will be effective from July next year. This means that anyone earning between $45,000 and $200,000 will pay the same marginal tax rate of 30%.
Single parents will receive $1.9 billion over five years, benefitting around 57,000 single parents who will receive payments for more extended periods. In addition, the Child Care Subsidy will begin on July 1, benefiting around 1.2 million families, with childcare costs expected to fall. Parental Leave Pay and Dad and Partner Pay will be merged into a 20-week payment from July 1st, with an expanded family income test and eligibility for 3,000 more parents and plans to extend Paid Parental Leave to 26 weeks by 2026.
Rules around Superannuation Guarantee entitlements and contributions caps are also changing to help employees keep track of their Superannuation Guarantee entitlements and enable the Australian Taxation Office to recover unpaid superannuation more easily. Starting from July 1, 2026, employers will be required to pay SGE simultaneously as salary and wages instead of quarterly, while individuals who have a total superannuation balance exceeding $3 million will experience reduced tax concessions beginning on July 1, 2025, with earnings over the threshold taxed at 30%.
Support for Businesses and Institutions
Small businesses in Australia can look forward to a boost through several budget measures. Firstly, under the Small Business Energy Incentive, small and medium-sized businesses with an annual turnover of less than $50 million can claim a bonus deduction of up to $20,000 on eligible assets or upgrades that support the use of energy-efficient depreciating assets. Additionally, they can receive an extra 20% deduction of the eligible depreciable assets cost that supports electrification and better energy use. Only those assets or upgrades used or installed between July 1, 2023, and June 30, 2024, are eligible for the maximum bonus deduction.
There's also a reduction in the tax instalment uplift rate for2023-24 and the 'Payday' super policy, which will require employers to pay the super guarantee (SG) on the same day as salary and wages by July 1, 2026. On top of these, small businesses with an annual turnover of less than $10 million will have access to cash flow support through a $20,000 instant asset write-off for eligible assets used or ready for use between 1 July 2023 and 30 June 2024. The Government is also investing $101.6 million over five years to improve cybersecurity in small businesses and $23.4 million to train in-house cyber wardens, boosting cybersecurity resilience.
Support for Infrastructure and Housing
The Australian Government is investing in major infrastructure projects to boost regional development, including the Build-to-rent (BTR) initiative encouraging investment in large-scale rental developments for better rental options. New BTR projects are eligible for concessional treatment, including a 15% MIT withholding tax rate and an increased capital works tax deduction rate, provided they have at least 50 apartments or dwellings for public rent, be under single ownership for ten years before the sale, and offer a lease term of three years per dwelling. These changes aim to create an affordable Australian rental market, with the 15% MIT withholding rate effective from July 1, 2024.