The Federal Budget Proposals 2016 vs Taxpayers

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The Federal Budget Proposals vs Taxpayers

Key Budget Proposals:

If you earn more than $80,000

 

From 1 July 2016, the income threshold where the 37% marginal tax rate starts to apply will increase from $80,001 to $87,001. The income threshold and marginal tax rates from 1 July 2016 are as follows:

 

Taxable income threshold

Tax payable (excluding Medicare levy)

% tax on excess

$18,200

Nil

19.0%

$37,000

$3,572

32.5%

$87,000

$19,822

37.0%

$180,000

$54,232

47.0%

 

If you negatively gear investments, such as an investment property

 

The Government has announced officially that they will not remove or limit negative gearing because it would increase the tax burden on Australians trying to invest for their future.

 

If you earn more than $180,000 pa

 

The three year Temporary Budget Repair Levy on high income individuals will cease from 1 July 2017. Up until then the temporary levy will continue to apply at a rate of two percent on individuals’ taxable income in excess of $180,000 per annum. This will mean that the top marginal tax rate will reduce from 47% to 45% (excluding Medicare Levy) from 1 July 2017.

 

 

Increase to Medicare levy low-income thresholds

From the 2015-16 financial year, the Medicare levy low-income threshold will be indexed for individuals and families to take into account movements in the CPI.

 

Note: This is not a complete list of all the budget proposals