The 2024-25 Federal Budget was handed down by Treasurer the Hon. Dr Jim Chalmers MP on 14 May 2024. The budget surplus is estimated to be $9.3 billion, following a $22.1 billion surplus in 2022-23.
The budget places a strong emphasis on supporting households, women’s health, small businesses, seniors, and various other sectors critical to Australia’s economic well-being. By implementing targeted measures, the government aims to stimulate economic growth and provide much-needed relief to individuals and businesses across the nation.
Tax relief and cost-of-living support
The Australian Government has enacted permanent tax cuts for 13.6 million Australian taxpayers through the Treasury Laws Amendment (Cost of Living Tax Cuts) Act 2024. These changes, effective from 1 July 2024, include a reduction in lower marginal tax rates and thresholds. Individuals with taxable income of $135,000 or less will now have a maximum marginal tax rate of 30 percent. The top marginal tax rate of 45 percent will apply to taxable income above $190,000. The government aims to alleviate the cost of living and support labour supply with these adjustments.
Household energy rebate
Australian households can expect a $300 energy rebate effective from 1 July. With an estimated cost of $3.5 billion, this measure aims to help families manage their power bills and reduce financial strain. This credit is set to provide a significant 17 percent reduction on the average power bill.
Supporting women’s health
Recognising the importance of women’s health, the budget allocates over $160 million toward women’s health programs. Notably, more than $50 million will be directed to maternity care, $49 million to complex conditions such as endometriosis, and funding to support women and families who have experienced miscarriages. Additionally, a Professional Development course called Managing Menopause will receive $1 million over two years to support healthcare workers.
Boost for small businesses
Small businesses are set to benefit from the budget as well. Approximately one million businesses will receive a $325 energy rebate, slightly higher than that offered to households. Additionally, the $20,000 instant asset write-off will be extended for another year until 30 June 2025, supporting around four million businesses in managing their investments.
Supporting seniors and aged care
Age pensioners and concession cardholders will experience relief with the freezing of medicine costs under the Pharmaceutical Benefit Scheme (PBS) for five years. This initiative ensures that no pensioner or concession cardholder will pay more than $7.70 for their necessary medications. Furthermore, $2.2 billion in new aged care funding will be allocated, including 24,000 new home care packages and measures to enhance systems for individuals to remain in their own homes.
Addressing housing and homelessness
The government aims to address housing challenges and homelessness by investing $423 million over five years to support the construction of social housing and homelessness services. An additional $1 billion will be provided to states and territories to enhance housing supply in well-located areas. Moreover, $1.9 billion in loans will facilitate the construction of 40,000 social and affordable homes.
Other highlights
The budget also includes various noteworthy measures. Mental health funding receives $361 million, enabling the establishment of a new national digital mental health service supporting 150,000 individuals. Funding of $3.4 billion over five years will contribute to new and amended listings on the Pharmaceutical Benefit Scheme, expanding access to treatments for heart disease and breast cancer.
Conclusion
The 2024-25 Federal Budget strikes a delicate balance by addressing cost-of-living concerns while keeping inflationary pressures in check. With provisions for tax relief, energy rebates, women’s health, small businesses, seniors, and housing, the government aims to stimulate economic growth and support Australians across various sectors. Regency Partners will continue to monitor the implementation of the budget and provide updates on its impact on the Australian economy and individuals alike.
