THIS has been sold as a Budget of “choices”, and the Government has made some clear-cut decisions about who to reward and who to penalise (smokers, you’re too easy a target).
Here’s our round-up of the biggest winners and losers. But don’t worry too much — ultimately, we’re all losers together.
First home buyers
From July 1, 2017, young people will be given the option of piggybacking on their superannuation to access a kind of super-charged savings account, which will allow savers to salary sacrifice up to $30,000 – $15,000 in a single year – from their pre-tax income to later go towards a first home deposit.
It will receive the same favourable tax treatment going in and out as superannuation. The government says when it comes time to cash out, the scheme will leave savers about 30 per cent better off overall than if they went with a typical deposit savings account.
Whether you get a shiny new iPad will very much depend on which school you go to.
An extra $18.6 billion will be injected into school funding over the next decade under David Gonski’s needs-based model, originally championed by Labor.
But the model will not discriminate between public, private and Catholic schools, so 24 of the nation’s wealthiest schools will experience “negative growth” in their funding and 350 “slower growth”.
More than 9400 schools will see an uptick in funding, however, as it increases from $17.5 billion this year to $22.1 billion by 2021 and $30.6 billion by 2027.
The Government is hitting back at Labor’s “Mediscare” campaign with a new Medicare Guarantee Fund to cover essential healthcare.
It will provide $1 billion over four years from 2017-18 for the phased unfreezing of the Medicare rebate, starting with bulk billing incentives for GPs in July 2017, moving on to specialist consultations in 2018, specialist procedures in 2019 and diagnostic imaging in 2020.
Some medicines could be cheaper as more items are listed on the Pharmaceutical Benefits Scheme and doctors are encouraged to prescribe generic brands.
There will be an extra $2.8 billion in funding for hospitals, including $730 million for Tasmania’s Mersey Hospital.
The Medical Research Future Fund will get $65.9 million towards preventive health research, clinical trials and breakthrough research investments, and $5.8 million will be provided for research into childhood cancer.
The Government will provide $268.9 million over two years for a one-off winter energy payment in 2016-17 of $75 to singles and $125 per couple.
The pensioner concession card will be restored to those who lost it after the pension assets test change introduced earlier this year, so seniors will regain access to state and territory based concessions that were withdrawn after the change.
The Government will also provide $5.5 billion for home support services for the elderly as Australia’s population continues to age.
But the residency requirements will be tougher, with recipients required to have 15 years of continuous Australian residence.
More tax breaks and red tape reduction are on the cards this year, with the $20,000 instant asset tax write-off introduced in the 2016 budget being extended for another year until 2018, and opened up to businesses with an annual turnover of up to $10 million. The federal government is also offering states and territories up to $300 million in exchange for reducing red tape for small businesses.
Sure, Medicare is getting a boost — but you’ll be paying for it. The Budget will hit most workers hard, with a $8 billion tax grab.
The Government will increase the Medicare levy from 2 per cent to 2.5 per cent of taxable income from July 1, 2019 to fund the National Disability Insurance Scheme.
You’ll only be exempt if your income is below the threshold of $21,655 for singles, $36,541 for families and $34,244 for pensioners.
Other tax rates that are linked to the top personal tax rate, such as the fringe benefits tax rate, will also be increased.
The measure is predicted to make $8.2 billion revenue for the Government over four years.
University funding will be cut by $2.8 billion over four years. Students will face a 7.5 per cent tuition fee hike, phased in over four years starting in 2018.
The maximum increase for a four-year, government-subsidised degree will be $3600, with a maximum total cost of $50,000. A subsidised six-year medical degree will cost a maximum of $75,000.
Graduates will start repaying their loans at a lower income threshold of $42,000 instead of $51,957, high income earners (over $119,882) will pay 10 per cent of their income instead of eight per cent.
Income thresholds for repayment will be indexed to the consumer price index instead of the faster rising average weekly wages, meaning higher repayments to the government over the longer term.
Universities will have to meet a 2.5 per cent efficiency dividend, and their funding will depend on performance.
Spending on arts and cultural heritage will decrease by 2.6 per cent in real terms from 2016-17 to 2017-18, and by 12.0 per cent in real terms over the period 2017-18 to 2020-21.
This includes programs that support funding for the arts and cultural institutions, reflecting the implementation of efficiencies and arts-related savings measures from 2014-15 and 2015-16.
The war on durries continues. Roll-your-own tobacco and cigars will soon be more expensive under a plan to bring their tax treatment in line with pre-made cigarettes. The change will be phased in over four years from 2017 to 2020, to coincide with the existing annual 12.5 per cent tobacco tax increases which occur on 1 September each year. The move is expected to claw an extra $360 million in tax revenue from Australia’s brown, stained fingers over the next four years.
As well as previously announced changes to the 457 visa system, the government will also introduce a levy on businesses that employ foreign workers.
From March next year, the levy on foreign workers on certain skilled visas will go towards a new Skilled Australians Fund.
Small business will have to pay $1200 per year for a foreign worker, along with a one-off $3000 payment. Larger businesses would pay $1800 a year per worker, along with a one-off payment of $5000.
This is expected to bring in $1.2 billion over the next four years to go towards training Australian workers.
Foreign investors in Australian residential property are facing tougher rules, including the removal of the main residence capital gains tax exemption, tightened compliance and a cap 50 per cent sales to foreigners in new developments. There will also be a “ghost tax” of at least $5000 per year on all foreign investors who fail to either occupy or lease their property for at least six months of the year.
Originally Sourced from Here