The 2024 Federal Budget provides cost of living relief through 1 July tax cuts, lower power bills, higher welfare payments and support for small businesses.
Note: These changes are proposals only and may or may not be made law. You should speak to your financial adviser to understand more about how these proposals could apply to you.
Cost of living
Energy bill relief
All Australian households will receive an energy rebate of $300 and eligible
small businesses will receive $325 from 1 July. It's not yet known exactly when rebates will be applied to accounts.
Student debt indexation changes
Higher Education Loan Program (HELP) loan holders will benefit from changes to indexation, with debts to be increased by the lower of inflation and wages growth. Currently, these debts are indexed to inflation annually on 1 June. The change will be backdated to 1 July 2023 and an 'indexation credit' may be provided to reduce outstanding loan balances. To estimate indexation credits, check out this HELP Indexation Credit Estimator. If a voluntary payment is made to reduce the HELP balance and any indexation, it's important to leave enough time after the payment is made for it to be processed by the ATO. The ATO usually release payment cut-off dates and publish this on their website.
Freeze on cost of PBS medicines
The maximum Pharmaceutical Benefits Scheme (PBS) co‑payment of $7.70 will be frozen for pensioners and Commonwealth concession cardholders until 31 December 2029. For all other Medicare card holders, the co-payment of $31.60 is frozen until 1 January 2026. The co-payment is the amount that must be contributed towards the cost of PBS subsidised medicines.
Personal taxation
Tax cuts for all taxpayers
From 1 July, 13.6 million taxpayers will pay less tax compared to the current financial year, when the re-worked Stage 3 tax cuts take effect. The tax savings depend on taxable income and can be estimated using this Tax cuts calculator. The table below outlines the new rates and thresholds from 1 July 2024, as well as the current financial year. The tax cuts aim to provide cost-of-living relief, but may also be used to reduce debt, invest or top-up super.
| Current financial year (2023/24) | From 1 July 2024 | ||
| Taxable income | Tax rate* | Taxable income | Tax rate* |
| Up to $18,200 | Nil | Up to $18,200 | Nil |
| $18,201 - $45,000 | 19% | $18,201 - $45,000 | 16% |
| $45,001 - $120,000 |
32.5% | $45,001 - $135,000 | 30% |
| $120,001 - $180,000 | 37% | $135,001 - $190,000 | 37% |
| > $180,000 | 45% | > $190,000 | 45% |
*Plus Medicare levy/surcharge where applicable.
