Yahoo Finance Treasurer’s ‘cash-splash’ call ahead of budget
Treasurer Jim Chalmers says cost-of-living support is “likely” in the upcoming budget.
Aussies can expect cost-of-living support in the upcoming federal budget, but it won’t be the “cash splash” you might have been hoping for.
In a pre-budget speech today, Treasurer Jim Chalmers said there would “likely” be additional help with the cost of living but it would not be “anywhere near the magnitude” of the amended stage three tax cuts.
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“We are already providing a tax cut to every taxpayer and a bigger tax cut to more workers,” Chalmers said.
“We need to be upfront and say that any additional help will only be a fraction of that. Any extra help will be targeted, responsible and affordable.
“There will not be big cash splashes in the budget. It’s as simple as that.”
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Chalmers said the government would be shaping the budget based on the “economic cycle” and not the “electoral cycle”. He added the government didn’t “see cost-of-living help as stimulus” as it had during the global financial crisis and pandemic.
“We see cost-of-living help as a way of taking the pressure off inflation, not adding to it,” Chalmers said.
“Anything that's too costly, too splashy risks undoing the good progress that we have made together on inflation.”
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What cost-of-living support has already been announced?
All taxpayers will receive a tax cut under the amended stage three tax cut changes. A person on an average income of $73,000 will get a cut of $1,504.
Under the changes, the lowest tax rate will be reduced from 19 to 16 per cent for incomes between $18,200 and $45,000.
The second tax rate will be reduced from 32.5 to 30 per cent for people earning up to $135,000. The 37 per cent rate will be retained but will kick in from $135,000, instead of $120,000, while the top rate of 45 per cent will now kick in at $190,000, rather than $180,000.
The government also plans to make superannuation payable on parental leave payments from July 1, 2025, should it win the next election. The Coalition has said it supports the policy in principle.
The move follows the government’s planned expansion of the paid parental leave scheme, with parents set to receive an increase of 26 weeks of paid leave by July 2026. They currently receive 20 weeks.
