Following the announcement of the new federal budget, Treasurer Dr. Jim Chalmers has outlined some fairly likely expectations you can have for the new growth forecasts and economic conditions – including:
- Income tax cuts
- New spending initiatives
- $9.3 billion overall surplus for the financial year
- Changes to inflation
All in all, from the high cost of living to low-projected economic growth, this budget approaches some of the key issues Australians face globally and domestically.
The Cost of Living
Dr. Chalmers’ reckons that it’s the middle to lower income households who are going to benefit the most from the new federal budget because of the Stage three tax cuts. As of 1 July 2024 the 19% tax rate will go down to 16, and similarly, the 32.5% tax rate goes down to 30 – some of the other spending measures that were outlined in the budget will also add to this benefit, but the main takeaway here is that your tax burden is significantly reduced if you fall in those categories we just mentioned.
Aside from this, there’ll also be a couple other measures that aim to tackle the cost of living crisis:
- Energy relief for homes and certain small businesses ($300 and $325 respectively)
- Commonwealth Rental Assistance rate increased by 10%
Future Economic Growth
A new initiative, the ‘National Interest Framework’ has been announced to support a range of industries across the country, which Dr. Chalmers claims will put Australia in a prime position for economic growth in the future:
- Hydrogen Production Tax Incentive that’ll cost them $6.7 billion in the medium term (renewable hydrogen)
- Plans to invest $466.4 million in the company ‘PsiQuantum’ for building a quantum computer that can be used commercially
- The ‘Solar SunShot Program’ to manufacture new solar panels, costing roughly $1 billion
- $7 billion invested in a tax incentive for ‘Critical Minercals Production’
Changes to Housing Policies
Foreign investors will be able to enjoy lower fees for ‘Build-to-Rent’ developments, and there’s also been another $1 billion of funding for new housing infrastructure sent to State and Terrirotry Governments.
Furthermore, Dr. Chalmers outlines 20,000 TAFE and pre-apprenticeship places (fee-free) to support their five year goal of building 1.2 million new homes over the country, of which an additional 90,000 construction workers will be required.
Immigration is also a topic they’re seeking to tighten more broadly, and they’re mainly doing this by imposing stricter requirements for any students arriving internationally and assurances that they’ll be working with universities throughout the country to increase the availability of student accommodation.
While there’s definitely still a lot of progress that needs to happen here, these initiatives Dr. Chalmers outlined are undoubtedly a positive step forward for reducing the lack of housing throughout Australia.