More than half a million high-income earners in Australia will get a tax break amounting to around $9,075 after the Labor Government went ahead with the legislated stage three tax cuts in tonight's Budget.
Brought in by the previous Morrison government, the tax cuts will flatten the tax rate to 30 per cent for people earning between $45,000 and $200,000.
This means everyone who earns between those amounts will be taxed at the same rate, and the existing tax bracket for those earning between $120,000 and $180,000 will be removed.
The top tax threshold will also be lifted to above $200,000.
The tax cuts are set to take effect from July 2024, but there has been mounting pressure for the new Albanese Government to ditch the changes.
Stage 3 tax cuts to cost Budget big
Australia’s government makes a lot of money from collecting taxes, money it uses to fund everything that will be set out in the Federal Budget tonight.
Going ahead with the stage three tax cuts in 2024 is estimated to cost the Budget a massive $184 billion over 10 years.
And with government debt sitting around the $1 trillion mark - every penny counts to getting the economy back on track.
Tax cuts not just for higher-income earners
However, while around 600,000 high-income earners are set to benefit from the tax cuts, there are many middle-income earners who will also see a boost.
Independent economist Chris Richardson said the impact of the stage three tax cuts on fairness was overblown.
Richardson said the tax changes would make little difference to the proportions of tax paid by higher-income earners.
"Although stage three does benefit the top 10 per cent, it actually delivers tax cuts to the top 78 per cent of taxpayers," Richardson wrote on Twitter.