The Prime Minister has officially announced the following proposed changes to the Stage 3 tax cuts:
- Lower the tax rate from 19% to 16% for incomes ranging between $18,200 and $45,000
- Reduce the tax rate from 23.5% to 20% for incomes between $45,000 to $135,000 the newly established threshold.
- Increase the income threshold at which the 37% tax rates apply from $120,000 to $135,000
- Increase the threshold at which the 45% tax rate applies from, $180,000 to $190,000
Therefore, assuming that the necessary legislative amendments are approved, the Australian resident personal income tax rates from 1 July 2024, will be as follows:
| From 1 July 2024 | |
| 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 |
The Treasury has furnished a tax savings calculator on their website.
For more information about these measures please click here. If you would like to discuss in detail how these would affect your tax position feel free to contact us.