Discussions within the government around stage three tax cuts are in place, which are set to take effect by July 2024.
Minister for skills and training Brendan O’Connor said this morning that the government “has not altered” their commitments towards the stage three tax cuts. However, MP O’Connor has said that there is a lengthy process to this due to the preparation for the national budget coming up in three weeks as they search for savings from “misspent rorts”.
“I know that the treasurer, prime minister, finance minister, the cabinet are looking at these issues,” said O’Connor.
“I think we need to consider these things but let’s remember that stage three tax cuts are not until almost two years away and we have to consider the immediate matters before us and deal with them now.”
The stage three tax cuts are already considered “L-A-W law” by former Prime Minister Paul Keating who promised tax cuts in 1992, which unfortunately was not kept.
In 2018 and 2019, the Australian parliament had passed the then-Coalition government’s tax income package, which includes tax cuts that are designed to be phased in over a number of years.
This means the Albanese government can amend the law if they intend to make changes to the elements of the tax package.
With the stage three tax cuts, it will help to abolish the current 37 percent tax bracket, lowering it from 32.5 percent to 30 percent. This means that every taxable dollar you earn from $45,001 to $200,000 will be taxed at 30 percent, but every dollar you earn above $200,000 will be taxed at 45 percent.
However, if you earn only around $45,000 a year, you will get tax savings of exactly zero dollars from the stage three tax cuts. This is set to benefit middle to top income earners, as compared to lower income earners.
Once these cuts are phased in by 2024, 2.5 million Australians will have to pay thousands of dollars in additional taxes.
Photo: Tax Deductions Words on Black Surface by Nataliya Vaitkevich available HERE is used Creative Commons licence. This image has not been modified.
