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Federal Budget 2018: The winners and losers

Average income earners, seniors, small businesses and the sick are among the main winners in the 2018 federal budget, handed down on Tuesday.

Lower and middle-income Australians will get immediate tax relief with tax cuts rising to $530 a year for those earning up to $90,000.

Pregnant women will have access to the whooping cough vaccine for free, small businesses will get a boost and seniors will be able to keep more of what they earn on the side.

But the rich, multinationals and tax cheats weren’t as lucky.

What are you going to do now? What does it matter for me? These are the questions Australians are answering, asking and want answered tonight,” Mr Morrison told parliament in Canberra.

Here’s your guide to the 2018-2019 Federal Budget winners and losers.

Treasurer Scott Morrison handed down the 2018-2019 federal budget on Tuesday night. Photo: AAP


Pensioners and older Australians

Older Australians are being enticed into work through a raft of pension sweeteners outlined in the budget.

Aged pensioners will be able to earn an extra $50 per fortnight without affecting their payments, as part of a suite of measures designed to give older Australians greater choice and financial security.

The pension work bonus will also be expanded to allow self-employed retirees to earn up to $300 per fortnight without copping a whack to their pensions.

More than $250 million over five years will go towards measures enhancing the standard of living of older Australians.

The various announcements are intended to complement funding for an extra 14,000 high-level home care packages so people can stay in their homes longer if they wish.

Up to $10,000 in wage subsidies will be provided to employers who take on staff aged over 50, with further incentives provided to up-skill mature aged workers.

The pensions loan scheme will be opened up to all older Australians, allowing couples to boost their retirement incomes by up to $17,800 without affecting their eligibility for benefits.

This will enable people to use the equity in their homes to increase their incomes.

Aged pensioners will be able to earn an extra $50 per fortnight without affecting their payment. Photo: Getty

Low and middle income earners

94 per cent of Australians will be on a tax rate of 32.5 per cent or less in 2024, with those on the average wage of $84,600 saving $530 a year.

“For middle income households with both parents working on average wages, this will boost the ‘kitchen table’ budget by more than $1000 every year,” Mr Morrison said.

Also from July 1, the 32.5 per cent tax bracket threshold will be increased to $90,000, from $87,000, which save 210,000 people from having to pay 37 cents in the dollar due to bracket creep.

The tax cuts start at $200 a year for those in the lowest bracket, rising to $530 a year for those earning up to $90,000, from July 1 this year.

“Anyone who thinks that doesn’t matter clearly is not in touch,” Mr Morrison told reporters.

That $90,000 figure is the new threshold for the 32.5 per cent tax bracket, which was set at $80,000 just two years ago.

In four years time the $37,000 tax threshold will be lifted to $41,000.

And in 2024/25 – which is six years away, and assuming the coalition is still in power – the government will abolish the 37 per cent rate entirely

“Most working Australians earning above $41,000 are likely to never face a higher marginal tax rate through their entire working life,” Mr Morrison said.

There is now Medicare support for dialysis in remote areas, a new listing for spinal surgery, MRI scans for prostate cancer and 3D tests for breast cancer. Photo: Getty


Treatments for breast cancer, spinal muscular atrophy, and Hodgkin lymphoma have had their prices slashed in this year’s federal budget.

The Tuesday release confirmed the Turnbull government is setting aside $1.4 billion for new and changed listings on the Pharmaceutical Benefits Scheme.

From June 1, Spinraza will cost patients with spinal muscular atrophy less than $40 a script, and $6.40 for concessional patients, instead of more than $367,850 a year.

Pregnant women will have access to a free whooping cough vaccine from July and the flu shot won’t cost a thing for Australians over 65 years.

There is now Medicare support for dialysis in remote areas, a new listing for spinal surgery, MRI scans for prostate cancer and 3D tests for breast cancer.

The government has also found $28.2 million over five years to upgrade the e-prescribing software system used by doctors to prescribe drugs.

Small businesses

Small businesses which employ about 3.3 million Australians will get an injection of life from a corporate tax cut and an extension of the instant asset write-off.

The Government extended the $20,000 instant asset write-off for another 12 months.

Pensioners, retirees, and low and middle-income earners were the biggest winners in the budget. Photo: AAP

Superannuation recipients 

Exit fees charged to people trying to close unwanted superannuation accounts have been banned in a suite of new budget measures aimed at protecting retirement incomes.

People who have failed to keep track of their superannuation will also benefit from a new cap on some fees and new tax office capabilities that will allow them to be automatically reunited with lost or inactive accounts.

The federal government will cap passive fees on accounts with balances below $6,000 at three per cent from July 1, 2019, and all exit fees will be banned.

Expectant parents 

New parents will no longer need to keep a paper baby book recording their child’s development, under changes announced in the federal budget.

The government is committing $5 million over two years to develop a national digital baby book.

This will replace the existing state and territory hard copy books that document a child’s health records.

The budget released on Tuesday also includes $3 million to develop a new guide for would-be parents on how to stay healthy during pregnancy.

Every Australian mother will also be able to be vaccinated against whooping cough for free, after the government found $39.5 million to list the vaccine as part of the national immunisation program.

Every Australian mother will also be able to be vaccinated against whooping cough for free. Photo: Getty



Welfare recipients

Welfare recipients with unpaid court fines or outstanding criminal warrants will be targeted under new hardline government measures laid out in the federal budget.

People with outstanding Centrelink debts of more than $10,000 will also be aggressively pursued as the coalition tries to claw back money from those who are no longer on welfare and have the means to pay.

“We will ensure our targeted safety net helps people when they need it, but that people receive only what they are entitled to, nothing more and nothing less,” Social Services Minister Dan Tehan said in a statement on Tuesday.

“When welfare recipients have received money they are not entitled to, we will ensure those debts are repaid.”

People with outstanding Centrelink debts of more than $10,000 will be aggressively pursued under hardline government measures laid out in the federal budget. Photo: Getty

Renters, first home buyers

Furious affordable housing advocates delivered a blistering review of a federal budget they say has “completely abandoned” renters, first home buyers and people in desperate need of shelter.

Adrian Pisarski from National Shelter said that apart from some spending on remote housing in the Northern Territory, the budget had done nothing to boost housing stock.

“I don’t know how we go in one year from housing being the centrepiece of the budget to the next year being completely abandoned by the treasurer,” he told reporters in Canberra on Tuesday.

“That’s a tragedy in Australia and a real lost opportunity.”

Mission Australia chief executive James Toomey said despite census figures confirming rising homelessness, the government had ignored the issue.

“The government has missed another opportunity in the budget to address rising homelessness and provide a national plan to meet the critical shortage of affordable housing for those on the lowest incomes,” he said.

“The absence of a plan is short-sighted and will only lead to greater social and economic dislocation down the track.

“I am very disappointed by this year’s virtual silence on both homelessness and affordable housing.”

Property Council of Australia chief executive Ken Morrison said the budget “packs a powerful infrastructure punch”, but housing affordability was still a concern.

“We need the funding, but we also need the planning, we also need to tackle the regulatory issues, to make sure we’ve got the housing our population as it grows needs,” he told reporters.

High income earners

There is not much tax relief for those earning over $125,000 until 2024/25 when the 37 per cent tax bracket is abolished.

Digital businesses 

Digital businesses will be made to pay their fair share of tax under new plans flagged by the Turnbull government.

Mr Morrison said he had been working with his G20 counterparts to “bring the digital economy into the global tax net”.

“In a few weeks’ time I will release a discussion paper that will explore options to tax digital businesses in Australia,” Mr Morrison said.

The budget papers note digital businesses can have a “significant economic presence in Australia without making a significant contribution to tax revenues here”.