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Federal Budget 2021/2022 Posted on May 12, 2021
On Tuesday 11 May 2021, Treasurer Josh Frydenberg handed down the 2021 Federal Budget on Tuesday, his 3rd Budget.
The Australian economy has rebounded at its fastest pace on record over the latter half of 2020. Nevertheless, 2021-22 Federal Budget deficit is $161 billion, which is $53 billion lower than what was initially projected in last year’s Budget, falling to $57 billion in 2024-25.
Net debt of $617.5 billion for 2021-22, which is expected to peak at $980.6 billion in 2024-25.
GDP growth forecast at 4.25% in 2021-22.
- Tax cuts for over 10 million low and middle income earners. Individuals will receive up to $1,080 and couples will get $2,160.
- Budget provides a further $2.1 billion in targeted support for aviation, tourism, arts and international education providers.
- Tax relief for around 1,000 small brewers and distillers.
- Double its commitment to the “JobTrainer” fund to help create new apprenticeships and traineeships.
- Investing $1.2 billion to build digital infrastructure, skills and cyber security.
- Launching a new patent box, under which income earned from new patents developed in Australia will be taxed at a concessional 17% rate. The patent box will apply to the medical and biotech sectors.
- Funding for transport infrastructure is a feature of the Budget, with an extra $15.2 billion, including for a new intermodal terminal in Melbourne and a new airport in NSW.
- Infrastructure spending of $110 billion is planned over the next decade.
- To spend $13.2 billion over 4 years for National Disability Insurance Scheme.
- More health services will be included on the Medicare Benefits Schedule, and more medications will be included on the Pharmaceutical Benefits Scheme.
- To commit $17.7 billion in new aged care funding.
- A $2.3 billion commitment to mental health care and suicide prevention.
- To commit $2 billion to fund preschools.
- To provide more than $19 billion in funding for universities in 2021-22.
- A further $1.9 billion allocated for vaccine rollout.
- Budget provides $1.5 billion for COVID-related health services, including testing and tracing, respiratory clinics and telehealth.
- Government to help another 10,000 first-home buyers build a new home with a 5% deposit.
- Some 10,000 single parents to purchase a home with a 2% deposit.
- Increasing the amount that can be released under the First Home Super Saver Scheme to $50,000 from $30,000.
- To allow those aged over 60 to contribute up to $300,000 to their superannuation fund if they downsize their home, freeing up more housing stock for younger families.
Women, welfare and safety
- $1.7 billion investment in childcare to help boost workforce participation and women’s economic security.
- New $1.1 billion funding for women’s safety which would deliver more emergency accommodation, legal assistance, counselling and financial support.
- To remove $450 monthly minimum income threshold for superannuation guarantee to help improve economic security for women.
- More than $600 million for community and household projects to mitigate the impact of natural disasters.
- $170 million to boost internet and mobile coverage in regional Australia, particularly in bushfire-prone areas.
For more information, refer to the Tax & Super Australia 2021 Federal Budget Report