The focus of this year’s Federal Budget is on personal tax cuts for low, middle and high income earners.
The government also announced several changes to super aimed at helping older Australians who can afford to make additional contributions to super.
Compared to previous budgets, the super changes are modest and will have little impact on most Australians.
It’s important to note that the super changes announced will need to be legislated and, with the Federal Election just around the corner, there’s no certainty the changes will be implemented. The government is expected to announce the date for the 2019 Federal Election later this week.
The tax cut proposals are designed to be implemented over a five year period with three key start dates:
An increase to the low and middle income tax offset providing up to $1,080 for singles and up to $2,160 for dual income families.
An increase in the income tax threshold for the 19% tax rate from $41,000 to $44,000 plus an increase in the low income tax offset from $645 to $700.
A decrease in the 32.5% tax rate to 30% for Australians earning between $45,000 and $200,000.
Changes to super
There are three changes to super which will benefit older Australians who can afford to make additional voluntary super contributions.
- People aged 65 and 66 years will be able to make voluntary concessional and non-concessional super contributions, without meeting the work test.
- The ‘bring-forward’ rule, which currently allows those aged less than 65 years to make three years’ worth of non-concessional contributions in one year will be extended to those aged 65 and 66. This will allow these people to make voluntary non-concessional contributions of up to $300,000 in a single year.
- Members will also be able to make voluntary contributions for a spouse up to age 74. Currently those aged 70 and over can't receive contributions made by another person on their behalf.
How the Federal Budget 2019 affects Tasmania
The Federal Government has committed $313 million to new projects to bust congestion, improve safety and better connect towns and regions.
The amount of $313 million is made up of the following new commitments:
State allocation of $68 million
- $68 million Tasmanian Freight Rail Revitalisation Program (tranche 3)
Urban Congestion Fund $35 million
- $25 million Hobart Congestion Package
- $10 million Tasman Highway Intelligent Transport Solutions
Roads of Strategic Importance $210 million
- $24 million Birralee Main Road upgrade between Westbury and Frankford
- $16 million Old Surrey Road/Massey Green Drive
- $25 million Murchison Highway
- $15 million Lyell Highway upgrade, Queenstown and Strahan
- $130 million Hobart to Sorell Road Corridor
This article contains information or advice that’s intended to be general in nature and which was prepared without taking into account your personal objectives, financial situation or needs. Because of that, before acting on any information or advice in this article, please consider whether it’s appropriate to your personal circumstances, talk to a financial planner and consider the relevant Member guide, available at tasplan.com.au or by calling 1800 005 166, before making a decision about whether to acquire the products.
The trustee of Tasplan Super (ABN 14 602 032 302) is Tasplan Pty Ltd (ABN 13 009 563 062). AFSL 235391. © 2019 Tasplan Pty Ltd. All rights reserved.