Government announces changes to proposed 'Stage 3' tax cuts

Despite previous assurances, and after much speculation, the Government has announced tweaks to the 'Stage 3' tax cuts that will apply from 1 July 2024.

More particularly, the Government proposes to:

• reduce the 19% tax rate to 16%;

• reduce the 32.5% tax rate to 30% for incomes between $45,000 and a new $135,000 threshold;

• increase the threshold at which the 37% tax rate applies from $120,000 to $135,000; and

• increase the threshold at which the 45% tax rate applies from $180,000 to $190,000.

The Medicare levy low-income thresholds for the 2024 income year will also be increased.

These changes still need to be passed into law, which is expected over the coming weeks.