Breaking Down the 2024 Federal Budget

By: MAD Wealth
May 15 2024
MAD Wealth

What You Need to Know

The 2024 Federal Budget has just been unveiled, and it’s packed with new measures and policies that will impact us all. As an accounting and bookkeeping firm, we understand how pivotal these announcements are for both our business and our clients.

Last year’s budget gave us a taste of financial positivity with the first surplus in 15 years. This time around, we’re diving deep into the details of the latest fiscal blueprint to help you understand what it means for your wallet and your business.

From changes in tax regulations to new funding initiatives, we’ve got the comprehensive lowdown on all the key points. Whether you’re a small business owner, an investor, or simply keeping an eye on your personal finances, we’ve sifted through the numbers and policies to bring you the most relevant updates.

Stay with us as we break down the 2024 Federal Budget, turning complex financial jargon into clear, actionable insights.

Let’s navigate this new fiscal landscape together and see how it can benefit you. Grab a coffee, get comfortable, and let’s get into it!

2024 Federal Budget Blog Posts Featured Image

Individuals and Families

Personal Income Tax Cuts Are Here!

Big news! From 1 July 2024, the Government is rolling out permanent tax cuts for all Australian taxpayers. These aren’t just your run-of-the-mill cuts—they’re designed to make a real difference, especially if you’re earning below $150,000.

Unlike the previous Stage 3 plan, these cuts cast a wider net, ensuring that more of us get to enjoy a bit of extra cash in our wallets. Whether you’re planning to save up, invest, or simply enjoy a little more financial freedom, these tax cuts are set to bring some welcome relief. So, get ready to see your take-home pay get a little boost!

For rates, see Personal income tax rates from 1 July 2024

Resources: Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024

Medicare Levy Relief: Higher Thresholds for Low-Income Earners

Starting 1 July 2023, there’s some good news for low-income earners, families, seniors, and pensioners. The Medicare levy low-income thresholds are getting a boost, making it easier for more Australians to access essential healthcare without the extra financial strain.

Here’s the breakdown:

  • Singles: The threshold jumps from $24,276 (as of 30 June 2023) to $26,000.
  • Families: The threshold moves from $40,939 (as of 30 June 2023) to $43,846.

Seniors and Pensioners:

  • Singles: From $38,365 (as of 30 June 2023) to $41,089.
  • Families: From $53,406 (as of 30 June 2023) to $57,198.
  • Each dependent child or student: From $3,760 (as of 30 June 2023) to $4,027.

These increased thresholds mean that more individuals and families will qualify for reduced or no Medicare levy, putting more money back in your pocket while ensuring you have access to vital health services. So, if you’re a low-income earner or supporting a family, this change is designed to give you a bit more breathing room.

Lighten the Load: $300 Energy Relief for Households

From 1 July 2024, households can look forward to some serious energy bill relief. The Government is rolling out a $300 credit on your energy bills, spread across quarterly instalments throughout 2024-25. This means you’ll see a little extra breathing room in your budget every few months.

But that’s not all! Eligible small businesses aren’t left out—they’ll receive a $325 rebate to help manage rising energy costs. This initiative, costing $3.5 billion over three years, is part of the expanded Energy Bill Relief Fund.

So, whether you’re a homeowner or running a small business, these rebates are designed to help ease the financial pressure and keep your energy costs in check. It’s all about making life a little more affordable while we transition to a more sustainable energy future.

Media release: New power bill relief

HELP Debt Relief: Capping Indexation for a Fairer Deal

Good news for those with student loans! As part of the 2024 Federal Budget, the Government has announced a cap on the indexation rate for HELP debts. Effective from 1 June 2023, the rate will be the lower of either the CPI or the Wage Price Index (WPI). This change applies to all HELP, VET Student Loans, Australian Apprenticeship Support Loans, and other student support loan accounts that existed on 1 June 2023.

Here’s what this means in real terms:

  • The indexation rate for 2023 drops from 7.1% to 3.2%.
  • For 2024, it’s expected to reduce from 4.7% to around 4%.

This adjustment addresses a significant issue for over 3 million Australians with HELP debts, especially after the CPI indexation rate spiked to 7.1% last year. For an individual with an average HELP debt of $26,500, this change could mean around $1,200 wiped from their outstanding loans this year, pending the passage of legislation.

Here’s a snapshot of the estimated credits:

  • $15,000 debt: $670 credit
  • $25,000 debt: $1,120 credit
  • $30,000 debt: $1,345 credit
  • $35,000 debt: $1,570 credit
  • $40,000 debt: $1,795 credit
  • $45,000 debt: $2,020 credit
  • $50,000 debt: $2,245 credit
  • $60,000 debt: $2,690 credit
  • $100,000 debt: $4,485 credit
  • $130,000 debt: $5,835 credit

By capping the indexation, the 2024 Federal Budget aims to ease the financial burden on students and graduates, making higher education debt more manageable. This is a significant win for anyone working to pay off their student loans while balancing other financial commitments.

Media Release: Cutting student debt for more than three million Australians

Boosting Future Savings: Superannuation on Paid Parental Leave

Starting 1 July 2025, the 2024 Federal Budget introduces a significant enhancement for new parents: superannuation will be paid on Paid Parental Leave (PPL) payments. This means eligible parents will receive an additional 12% of their PPL payments as a contribution to their superannuation fund.

This initiative ensures that taking time off to care for a newborn doesn’t come at the cost of your future financial security. It’s a proactive step towards closing the superannuation gap, especially for women who often face interruptions in their career due to parental leave.

But there’s more! This is on top of the recent changes that increased PPL from 20 weeks to 22 weeks, which will further increase to 24 weeks from July 2025 and 26 weeks from July 2026, thanks to the Paid Parental Leave Amendment (More Support for Working Families) Bill 2023. With these changes, the 2024 Federal Budget is making it clear: supporting families and ensuring financial security during parental leave is a top priority. This move not only provides immediate financial relief but also secures long-term benefits for parents as they plan for their retirement.

Media Release: Paying super on Government Paid Parental Leave to enhance economic security and gender equality

Rent Relief: Enhancing Commonwealth Rent Assistance

From 20 September 2024, the 2024 Federal Budget brings a much-needed increase to Commonwealth rent assistance. The maximum rates will rise by 10%, providing additional support to those struggling with rising rental costs.

Here’s what you need to know:

  • Current maximum fortnightly rates: $188.20 for singles and $177.20 combined for couples.
  • New maximum rates: An additional 10% on top of these amounts.

Recipients of Centrelink or Department of Veterans Affairs payments, as well as those receiving family tax benefits, may qualify for this rent assistance if they are paying rent or similar payments over a minimum fortnightly threshold.

This increase builds on the 15% hike from September 2023, making the maximum rates over 40% higher than they were in May 2022. This measure, costing $1.9 billion over five years from 2023–24, aims to provide ongoing support, with $0.5 billion per year allocated from 2028–29 onwards.

With the rising cost of living, this boost in rent assistance is a vital lifeline for many Australians. The 2024 Federal Budget is focused on ensuring that those in need receive the support required to manage housing expenses and maintain a stable living situation.

Enhancing Aged Care Support

In a significant move under the 2024 Federal Budget, the Government is dedicating $2.2 billion over the next five years to improve aged care support. This funding is set to drive key reforms and continue the implementation of recommendations from the Royal Commission into Aged Care Quality and Safety.

Key highlights include:

  • 24,100 additional home care packages: These will be released in 2024-25, providing more support to elderly Australians wishing to stay in their homes.
  • New Aged Care Act: The commencement date for this act has been deferred to 1 July 2025, allowing more time for thorough consideration and implementation of necessary changes.

The Government is actively reviewing and altering the funding model for aged care, based on the Royal Commission’s 2021 report. This will likely affect home care and residential care fees in the future. However, past reforms have shown that existing residents and home care recipients are typically ‘grandfathered’ under the rules at the time they entered, ensuring they retain their benefits.

With this substantial investment, the 2024 Federal Budget is prioritizing the well-being of our elderly population, ensuring they receive the quality care they deserve. These changes aim to make aged care services more accessible, affordable, and in line with the highest standards of care.

More Flexibility for Carers: Changes to Carer Payment

Great news for caregivers! The 2024 Federal Budget introduces increased flexibility for those receiving the Centrelink Carer Payment. Starting 20 March 2025, the rules around work, study, and training hours are getting a significant update.

Here’s the lowdown:

  • Current rule: Caregivers must not be involved in work, study, or training for more than 25 hours per week.
  • New rule: From 20 March 2025, this limit changes to 100 hours over four weeks, giving carers more flexibility in how they manage their time.

Additionally, study, volunteering, and travel time will no longer count towards this 100-hour limit, which will only apply to employment.

More changes include:

  • Suspensions instead of cancellations: If carers exceed the participation limit or their allowable temporary cessation of care days, their payments will be suspended for up to six months rather than canceled.
  • Flexible temporary cessation: Carers can now use single temporary cessation of care days when they exceed the participation limit, instead of the current seven-day minimum.

These changes, as part of the 2024 Federal Budget, aim to provide carers with the much-needed flexibility to balance their caregiving responsibilities with other aspects of their lives. This adjustment recognizes the invaluable role that caregivers play and offers them more support and adaptability in managing their commitments.

Better Support: Higher JobSeeker Rate for Partial Capacity to Work

As part of the 2024 Federal Budget, the Government is extending additional support to JobSeeker recipients with a partial capacity to work. From 20 September 2024, single recipients who can work zero to 14 hours per week will be eligible for the higher JobSeeker payment rate.

Currently, the higher rate is available to those aged 55 or over who have been on the payment for nine continuous months.

Here’s what the new rates will look like:

  • Single with no children: $762.70 per fortnight
  • Single with dependent children: $816.90 per fortnight
  • Single, 55 or older, after nine continuous months: $816.90 per fortnight
  • Partnered (each): $698.30 per fortnight

With these changes, the 2024 Federal Budget aims to provide better financial support to those with limited work capacity, ensuring they have a stable income while managing their health and employment limitations. This extension of the higher JobSeeker rate is a significant step towards more inclusive and supportive welfare policies.

Keeping It Steady: Freezing Social Security Deeming Rates

As part of the 2024 Federal Budget, the Government is freezing social security deeming rates for 12 months until 30 June 2025. This means that when calculating Centrelink and Department of Veterans Affairs payments, the deemed rate of return on financial investments will remain unchanged.

Here’s how it works:

  • Deeming rate (0.25%): Applied to investments up to $60,400 for singles and up to $100,200 for pensioner couples.
  • Deeming rate (2.25%): Applied to amounts over $60,400 for singles and over $100,200 for pensioner couples.

Common financial investments affected by these rates include bank accounts, term deposits, shares, and managed funds. By freezing these rates, the 2024 Federal Budget aims to provide financial stability and predictability for those receiving social security and veterans’ benefits, ensuring that fluctuations in investment returns do not impact their payments. This measure offers peace of mind and financial consistency for pensioners and other beneficiaries managing their investments.

Affordable Meds: Freezing Pharmaceutical Benefits Scheme Co-Payments

To keep healthcare affordable, the 2024 Federal Budget introduces measures to freeze indexation on Pharmaceutical Benefits Scheme (PBS) co-payments, ensuring the cost of medicines remains low for Australians.

Here’s the scoop:

  • PBS General Co-Payments: No indexation from 1 January 2025 to 31 December 2025. Indexation resumes on 1 January 2026.
  • PBS Concessional Co-Payments: No indexation from 1 January 2025 to 31 December 2029. Indexation resumes on 1 January 2030.

Additionally, the $1 optional discount on patient co-payments for subsidised prescriptions will gradually be phased out, decreasing each year by the relevant notional indexation amount until it reaches zero.

From 1 January 2024, most PBS medicines will cost up to $31.60, or $7.70 with a concession card. The Australian Government covers the remaining cost, except for brand premiums and certain other allowable charges.

By freezing these co-payments, the 2024 Federal Budget aims to ease the financial burden on individuals and families, ensuring essential medicines remain accessible and affordable for all Australians. This measure supports the health and well-being of the community, making it easier to manage healthcare expenses.

Big Plans for Housing: Federal, State, and Territory Governments Focus on Housing

Housing affordability and availability are at the forefront of the 2024 Federal Budget, with ambitious initiatives aimed at addressing housing supply, supporting first-time homebuyers, and providing crisis and social housing. Here’s the breakdown of how the government plans to tackle these issues:

Boosting Housing Supply:

  • 1.2 Million Homes by 2030: The government has set a goal to build 1.2 million homes by the end of the decade. This ambitious target relies heavily on private commercial development and incentives, particularly for build-to-rent projects that include affordable housing. Despite previous announcements, the necessary legislation to solidify these incentives is still in draft form, leaving some uncertainty for large-scale investments.

Easing the Path to Homeownership:

  • Help to Buy Scheme: Continuing from the 2023-24 Budget, the government has committed $5.5 billion over a decade to help first home buyers through the Help to Buy scheme. However, no new incentives have been announced in this budget.

Crisis and Social Housing Support:

  • $1 Billion for Crisis Accommodation: In addition to the 15% increase in Commonwealth Rent Assistance from the previous budget, this year’s budget allocates $1 billion towards crisis and transitional accommodation, specifically for women and children fleeing domestic violence and for youth.
  • Infrastructure Investments: To support housing development, $1 billion is allocated to states and territories for essential infrastructure such as roads, sewers, energy, water, and community amenities.
  • National Agreement on Social Housing and Homelessness: A new $9.3 billion five-year agreement will fund states and territories to combat homelessness, provide crisis support, and build and repair social housing. This includes doubling Commonwealth homelessness funding to $400 million annually, with states and territories matching this amount.

The 2024 Federal Budget’s housing initiatives reflect a comprehensive approach to addressing various aspects of the housing crisis.

By focusing on increasing supply, easing the path to homeownership, and supporting those in need of crisis and social housing, the government aims to create a more stable and accessible housing market for all Australians.

Media Release: Multi-billion-dollar investment to build more homes for Australians

Treasury consultation: Build-to-rent tax concessions

Escaping to Safety: Enhanced Support for Domestic Violence Survivors

In a significant move to support domestic violence survivors, the 2024 Federal Budget has committed nearly $1 billion over five years to establish the Leaving Violence Program permanently. Set to commence in mid-2025, this program is designed to offer comprehensive assistance to those escaping violence, ensuring they have access to both financial support and critical services.

Here’s what the program offers:

  • Financial Support: Eligible individuals can receive up to $5,000 to help them leave violent situations and start anew.
  • Safety Assessments: Comprehensive risk assessments to evaluate the immediate needs and threats faced by survivors.
  • Support Pathways: Referrals to a variety of support services, including housing, legal aid, and counseling, to provide holistic care and assistance.
  • Safety Planning: Personalized safety plans to ensure that survivors and their families can navigate the transition to a safer environment effectively.

By establishing the Leaving Violence Program, the 2024 Federal Budget aims to provide a lifeline to those in dangerous situations, offering not just financial help but a robust network of support to ensure their safety and well-being. This initiative underscores the government’s commitment to protecting the most vulnerable and creating pathways to safety and stability for all Australians facing domestic violence.

Media Release: Helping women leave a violent partner payment

Superannuation & Investors

Expanding CGT Regime for Foreign Residents

Big changes are coming for foreign residents when it comes to capital gains tax (CGT). Starting from 1 July 2025, the Government is expanding the CGT regime to ensure a fairer tax treatment.

Here’s what’s new:

  • Broader Asset Types: The types of assets subject to CGT for foreign residents are being clarified and expanded.
  • Extended Testing Period: The principal asset test will now cover a 365-day period.
  • Mandatory ATO Notification: Foreign residents must notify the ATO before disposing of shares or other membership interests valued over $20 million.

Currently, foreign residents are taxed on the sale of ‘taxable Australian property’ (TAP). This includes shares in a company or units in a trust if the taxpayer and related parties hold at least a 10% interest and more than 50% of the entity’s assets are tied to Australian real property. The new rules aim to tighten these regulations, ensuring Australia gets its fair share of tax from foreign sales connected to Australian land.

By aligning these rules more closely with OECD standards and international best practices, Australia is set to improve compliance and oversight, potentially boosting receipts by $600 million over five years.

Stay tuned as the Government consults on the details, ensuring these changes are implemented smoothly.

Business & Employers

Energising Small Businesses: $325 Energy Relief

Starting 1 July 2024, small businesses can look forward to a bit of financial relief on their energy bills. The 2024 Federal Budget introduces a $325 energy rebate for around one million small businesses, spread out as automatic quarterly credits over 2024-25.

This measure, part of the expanded $3.5 billion Energy Bill Relief Fund, aims to ease the financial burden on small businesses and households alike. Alongside the $325 relief for businesses, households will receive a $300 rebate on their energy bills.

By extending and expanding this fund, the Government is committed to supporting small businesses and helping them manage rising energy costs. This initiative is a key part of the 2024 Federal Budget’s efforts to create a more sustainable and affordable energy future for all Australians.

Media release: New power bill relief

Instant Asset Write-Off Extended: Small Business Bonanza

Great news for small businesses! The 2024 Federal Budget extends the $20,000 instant asset write-off, allowing small businesses with an aggregated turnover of less than $10 million to immediately deduct the full cost of eligible depreciating assets costing less than $20,000. This extension runs from 1 July 2023 to 30 June 2025.

Here’s the scoop:

  • Immediate Deduction: Claim a tax deduction for eligible assets in the same income year they are purchased and used (or installed ready for use).
  • GST Considerations: If registered for GST, the asset’s cost must be less than $20,000 after subtracting GST credits. If not registered for GST, the asset’s total cost must be under $20,000 including GST.
  • Per Asset Rule: Deduct the cost of multiple assets individually, as long as each qualifies.
  • Simplified Depreciation Pool: Assets costing $20,000 or more can be depreciated at 15% in the first year and 30% each subsequent year.

This initiative helps small businesses manage cash flow and invest in their operations more effectively. Remember, the increased threshold from the 2023-24 Budget isn’t law yet, so stay tuned for updates.

Media Release: Budget delivers for Australia’s small businesses

Powering Up: The Future Made in Australia Initiative

The Government is charging ahead with an ambitious plan to make Australia a “renewable energy superpower.” The $22.7 billion Future Made in Australia initiative is set to drive significant private sector investment into key industries, propelling the nation toward net zero and enhancing its global economic and strategic standing.

Key highlights include:

  • Targeted Investment: Focusing on industries where Australia holds a genuine economic advantage, contributing to a smooth transition to net zero.
  • Building Capabilities: Leveraging the skills of Australian people and the strengths of various regions.
  • National Security and Economic Resilience: Strengthening Australia’s position in the global landscape by boosting national security and economic resilience.

The Future Made in Australia Act will lay down the policy framework, ensuring these investments not only promote sustainability but also fortify the nation’s economic future. This bold initiative underscores the Government’s commitment to a greener, more resilient Australia.

Making Australia a Renewable Energy ‘Super Power’

As part of the Future Made in Australia initiative, the Government is investing $19.7 billion over ten years to boost priority industries like renewable hydrogen, green metals, low carbon liquid fuels, and clean energy technology manufacturing. Here’s a simplified breakdown of the key measures:

Tax Incentives:

  • Critical Minerals Production Tax Incentive:
    • Value: 10% of processing and refining costs
    • Duration: Up to 10 years per project for production between 2027-28 and 2039-40
    • Eligibility: Projects must reach final investment decisions by 2030
  • Hydrogen Production Tax Incentive:
    • Value: $2 per kilogram of renewable hydrogen produced
    • Duration: Up to 10 years per project for production between 2027-28 and 2039-40
    • Eligibility: Projects must reach final investment decisions by 2030

Funding Measures:

  • Pre-Feasibility Studies: $10.2 million in 2024–25 for critical mineral processing facilities.
  • Hydrogen Headstart Program: $1.3 billion over ten years to support early renewable hydrogen projects.
  • National Hydrogen Strategy: $17.1 million over four years for hydrogen infrastructure and safety.
  • Australian Renewable Energy Agency: $1.5 billion over seven years for renewable energy investments.
  • Innovation Fund: $1.7 billion over ten years for pilot projects in renewable energy sectors.
  • Clean Energy Manufacturing: $1.4 billion over 11 years for solar and battery manufacturing.
  • Low Carbon Liquid Fuels: $20.9 million over four years for further consultation and incentives.
  • Green Metals Industry: $18.1 million over six years for foundational initiatives.
  • Guarantee of Origin Scheme: $11.4 million over four years for green hydrogen and metals.

These investments and incentives aim to position Australia as a leader in renewable energy, driving economic growth and ensuring a sustainable future.

Resources: Treasury: Future Made in Australia National Interest Framework supporting paper
Fact Sheet: Future Made in Australia

Boosting the Silver Screen: Film Producer Tax Offset

Great news for the Australian film industry! As part of the National Cultural Policy, the Government is making significant changes to the Producer Tax Offset, effective from the 2025-26 income year. Here’s a simplified breakdown of the updates:

Current Offset Rates:

  • Feature Films: 40% of qualifying Australian production expenditure (QAPE).
  • Non-Feature Films: 20% of total QAPE.

New Changes:

  • No Minimum Length Requirements: The minimum duration requirement for content will be removed, allowing more flexibility in production.
  • Removing the Above-the-Line Cap: The cap of 20% of total QAPE for above-the-line costs (like actors, writers, and directors) will be eliminated.

These updates aim to boost the Australian film industry by providing more generous and flexible tax offsets, encouraging local production and making it easier for filmmakers to qualify for financial support. This initiative aligns with the broader goal of the 2024 Federal Budget to promote cultural growth and economic development through the arts.

Supporting Small Business: New Initiatives Announced

The 2024 Federal Budget has unveiled a series of initiatives aimed at supporting small businesses, with $41.7 million in funding over four years. Here’s what’s in store:

Improving Payment Times:

  • Naming and Shaming: Increased resources for the Payment Times Reporting Regulator to identify and expose businesses that are slow to pay small businesses.

Mental Health and Financial Wellbeing:

  • NewAccess for Small Business Owners: Extension of the program providing free, confidential mental health support tailored for small business owners.
  • Small Business Debt Helpline: Continued funding for this helpline to assist small business owners with financial advice and support.

Franchising Sector Code Changes:

  • Schaper Review Response: $3 million to improve the Franchising Code of Conduct, promote best practices between franchisors and franchisees, and enhance dispute resolution access.

Access to Justice:

  • Australian Small Business and Family Enterprise Ombudsman (ASBFEO): $2.6 million in funding to assist small businesses with dispute resolution and advocacy.

These measures are designed to improve the business environment, support mental health and financial wellbeing, and ensure fair practices and timely payments. The 2024 Federal Budget continues to show a strong commitment to helping small businesses thrive.

Government & Regulators

Modernising Digital Assets and Payments Regulation

The 2024 Federal Budget is investing $7.5 million over four years (and $1.5 million per year ongoing) to modernize the regulatory frameworks for digital assets and payment services. This initiative aims to boost competition and enhance consumer protections in the rapidly evolving financial services sector. Here’s a snapshot of the key measures:

Regulation of Digital Assets:

  • Legislation Development: The Government will develop and consult on new legislation to license and regulate platforms that hold digital assets.
  • Reform Progress: Continued work on Central Bank Digital Currencies, asset tokenization, and decentralized finance.

New Framework for Payment Services:

  • Regulatory Framework: Introduction of a new regulatory framework for payment service providers, including digital wallets and electronic stored value providers.
  • ePayments Code: Implementation of a mandated ePayments Code to standardize and secure electronic payments.

These updates will ensure that Australia’s financial services sector remains competitive and that consumers are well-protected as technology advances. The 2024 Federal Budget reflects the Government’s commitment to adapting to new technological trends while maintaining a secure and fair financial environment.

Extension of Transitional Reporting for Charities

The 2024 Federal Budget extends the transitional reporting arrangements for charities by five years. This move aims to reduce the regulatory burden on not-for-profit entities, ensuring they can focus more on their missions and less on paperwork.

Here’s what you need to know:

  • Extended Regulation: The Australian Charities and Not-for-profits Commission (Consequential and Transitional) Regulation 2016 will be remade, extending the current transitional reporting arrangement for another five years.
  • Simplified Reporting: The ACNC Commissioner can accept statements, reports, or other documents submitted to other Australian Government agencies as meeting certain reporting obligations under the ACNC Act.

By easing the reporting requirements, the Government is supporting charities in their essential work, ensuring they spend less time on administrative tasks and more time serving the community.

Strengthening ATO Counter Fraud Strategy

The 2024 Federal Budget allocates $187 million over four years to the Australian Taxation Office (ATO) to bolster its counter fraud capabilities. Here’s a simplified overview of the initiative:

Key Investments:

  • Technology Upgrades: $78.7 million for enhanced ICT systems to detect and block suspicious activity in real time.
  • Compliance Taskforce: $83.5 million for a new team dedicated to recovering lost revenue and preventing fraudulent refunds.
  • Management and Governance: $24.8 million to improve the ATO’s fraud management, including better support for fraud victims.
  • Independent Oversight: $0.4 million to the Department of Finance for a Gateway Review process ensuring the measure’s effective implementation.

Extended Notification Period:

  • The ATO will have an increased period (from 14 to 30 days) to notify taxpayers if it intends to retain a BAS refund for further investigation. This aligns with the notification period for non-BAS refunds and aims to better combat fraud during peak events like Operation Protego.


  • Estimated to increase receipts by $302.2 million and increase payments by $187.4 million over five years from 2023–24.

This comprehensive strategy aims to enhance the ATO’s ability to detect, prevent, and mitigate fraud, ensuring the integrity of Australia’s tax and superannuation systems.

Funding ATO Priority Targets

The 2024 Federal Budget allocates specific funding to the ATO for key priority targets. Here’s a simplified breakdown of the initiatives:

  • Personal Income Tax Compliance Program: Extended for one year from 1 July 2027. Estimated to increase receipts by $180.3 million and payments by $44.3 million over five years from 2023–24.
  • Shadow Economy Compliance Program: Extended for two years from 1 July 2026. Expected to increase receipts by $1.9 billion and payments by $610.2 million over five years. This includes $429.6 million in increased GST payments to states and territories.
  • Tax Avoidance Taskforce: Extended for two years from 1 July 2026. Focuses on top public, multinational businesses, and high wealth private groups. Estimated to increase receipts by $2.4 billion and payments by $1.2 billion over five years. The taskforce has already helped raise $32.7 billion in tax liabilities as of 30 June 2023.
  • Child Care Providers: $4.8 million over four years from 2024–25 to ensure compliance with tax system requirements related to the Child Care Subsidy Program.
  • Identity Checking: $155.6 million over two years from 2024–25 to continue improving Digital ID, myGovID, and related systems.
  • Migrant Workers: $1.9 million in 2024–25 for a data-matching pilot to prevent exploitation and abuse in the labour market and migration system.
  • E-Invoicing: $23.3 million over four years from 2024–25 to oversee and operate the secure eInvoicing network, helping combat scams and online fraud.
  • Military Invalidity Payments: $11.9 million over five years from 2023–24 (and $0.9 million per year ongoing) to implement a social security means test treatment for military invalidity payments affected by the Federal Court’s Douglas decision.

These targeted investments aim to enhance compliance, improve system security, and ensure fair tax practices across various sectors.

Sweet Deal: Decreased Levy for Sweet Potatoes

Starting 1 July 2024, the Government will reduce the overall levy rate on sweet potatoes from 1.5% to 0.5%. This decrease aims to provide financial relief to sweet potato producers, making it easier for them to manage costs and sustain their operations.

This change is part of the 2024 Federal Budget’s broader efforts to support the agricultural sector and ensure the continued growth and stability of Australian farming businesses.

Delayed Widening of the General Anti-Avoidance Rules

The 2023-24 Budget measure to extend Part IVA, originally set to begin on 1 July 2024, has been delayed. The changes will now apply to income years starting on or after the amending legislation receives Royal Assent.

What’s Changing:

  • Extended Scope: Part IVA, the general anti-avoidance provision, will be broadened to:
    • Target schemes that reduce tax paid in Australia by using lower withholding tax rates on income paid to foreign residents.
    • Apply to schemes that secure an Australian income tax benefit, even if the main purpose was to reduce foreign income tax.

This delay allows for thorough legislative review and ensures that the extended anti-avoidance rules are effectively implemented to combat tax evasion and ensure fair tax practices.

Delayed Streamlining of Fuel and Alcohol Excise Administration

The 2024 Federal Budget announces changes to the start dates for the components of the Streamlining Excise Administration for Fuel and Alcohol package. Here are the updated timelines:

  • Licence Application and Renewal Requirements: Originally set for 1 July 2024, now delayed to the later of 1 July 2024 or the day following Royal Assent.
  • Public Register of Excise Licences: The ATO will publish a public register of excise licences and excise equivalent warehouse licences 30 days after the legislation commences.
  • Bunker Fuels for Commercial Shipping: Removal of regulatory barriers has been postponed from 1 July 2024 to 1 January 2025.

These adjustments provide additional time for implementation, ensuring a smooth transition and effective administration of fuel and alcohol excise regulations.

Exemption for Australian Plantation Forestry Entities from Thin Cap Changes

In a key update, the 2024 Federal Budget exempts Australian plantation forestry entities from the new thin capitalisation earnings-based rule. Here’s a simplified breakdown:


  • 2022–23 October Budget: Introduced the Multinational Tax Integrity Package, amending thin capitalisation rules to replace safe harbour and worldwide gearing tests with earnings-based tests to limit debt deductions based on an entity’s profits.

What’s New:

  • Exemption for Plantation Forestry: These entities can continue using the former asset-based thin capitalisation rules instead of the new earnings-based tests.

This exemption acknowledges the unique nature of plantation forestry operations and ensures they are not disadvantaged by the new debt deduction limitations.

Measures Not Proceeding

The 2024 Federal Budget announces that certain previously proposed measures will not move forward:

  • Australian Business Number (ABN) System: The 2019–20 Budget measure aimed at strengthening the ABN system, with proposed start dates of 1 July 2021 and 1 July 2022, will not progress.
  • Intangibles in Low Tax Jurisdictions: The 2022–23 October Budget measure to deny deductions for payments related to intangibles held in low- or no-tax jurisdictions will not proceed. Instead, integrity issues will be addressed through the Global Minimum Tax and Domestic Minimum Tax. Additionally, from 1 July 2026, a new provision will impose penalties on groups with over $1 billion in global turnover that mischaracterise or undervalue royalty payments, circumventing royalty withholding tax.

These decisions streamline the tax system and focus on more effective measures to address tax integrity issues.

ATO Discretion on Offsetting Old Debts

The 2024 Federal Budget introduces a change that grants the Commissioner of Taxation the discretion not to use a taxpayer’s refund to offset old tax debts, specifically for debts placed ‘on hold’ before 1 January 2017.

Key Points:

  • Targeted Discretion: Applies to individuals, small businesses, and not-for-profits with old tax debts.
  • Maintaining Current Practice: This change aligns with the ATO’s current administrative approach but addresses the inconsistency highlighted by the Australian National Audit Office in 2023.

This amendment ensures fair handling of older debts while maintaining rigorous practices for debts from 1 January 2017 onward, providing clarity and relief for affected taxpayers.

Pursuing Entities in Liquidation with Unpaid Superannuation Obligations

Starting 1 July 2024, the Government will recalibrate the Fair Entitlements Guarantee (FEG) Recovery Program to better pursue unpaid superannuation entitlements owed by employers in liquidation or bankruptcy.

Key Points:

  • Enhanced Recovery: Focus on recovering unpaid superannuation entitlements from insolvent employers.
  • Fair Entitlements Guarantee (FEG): This legislative safety net provides assistance to eligible employees when their employer goes into liquidation or bankruptcy.

This adjustment aims to strengthen the protection of employee entitlements, ensuring that workers receive the superannuation owed to them even if their employer faces financial collapse.

‘Payday’ Super Compliance

The 2024 Federal Budget allocates $60 million over four years to enhance compliance and support the implementation of payday superannuation.

Key Points:

  • Increased Funding: Boost to the Productivity, Education and Training Fund.
  • Support Activities: Practical activities by employer and worker representatives to improve workplace productivity and cooperation.
  • Policy Implementation: Assistance for workplaces in adopting payday superannuation.

This initiative aims to ensure that superannuation contributions are made on payday, enhancing financial security for employees and improving overall compliance within the superannuation system.

Funding Anti-Money Laundering and Counter-Terrorism Financing Reform

The 2024 Federal Budget allocates $168 million over four years to strengthen Australia’s Anti-Money Laundering and Counter-Terrorism Financing Act 2006.

Key Points:

  • Reforms and Consultation: The Attorney-General’s Department held consultations from April to June 2023, with strong support for modernising the regime and regulating high-risk services provided by certain professions.
  • Simplification and Modernisation: Efforts to simplify and update the regime to enhance its effectiveness.

Funding Breakdown:

  • AUSTRAC Capabilities: $160.8 million over two years to expand the Australian Transaction Reports and Analysis Centre’s regulatory, intelligence, and data capabilities, and to guide newly regulated entities.
  • Attorney-General’s Department: $7 million over four years for policy and legal advice, stakeholder consultation, and anti-money laundering and counter-terrorism financing capacity building in the Pacific.

These reforms aim to bolster Australia’s defenses against financial crimes and ensure compliance with international standards, enhancing the integrity of the financial system.

Preventing Greenwashing and Managing Sustainable Finance Markets

The 2024 Federal Budget introduces measures to combat greenwashing and enhance the management of sustainable finance markets.

Key Initiatives:

  • Greenwashing Enforcement:
    • ASIC Funding: $10 million over four years and $1.9 million ongoing to investigate and enforce actions against greenwashing and sustainability-related financial misconduct.
  • Sustainable Finance Framework:
    • Treasury and APRA: $5.3 million over four years from 2024-25 and $1.2 million ongoing to issue green bonds, improve data, and develop international regulatory regimes related to sustainable finance.
  • Sustainability Labels:
    • Labelling Regime: $1.2 million for ASIC and Treasury to consult on the design of a regulatory regime for sustainability labels on retail investment products.

These measures aim to ensure transparency and integrity in the sustainable finance market, protecting investors and promoting genuine environmental and social benefits.


Women’s Budget Statement

This year marks the launch of Australia’s first national strategy dedicated to gender equality, Working for Women: A Strategy for Gender Equality. This ambitious ten-year plan is designed to make substantial advancements in gender equality. The Women’s Budget Statement will now act as the primary reporting tool for tracking the progress and investments related to this strategy.

Starting with the 2024-25 Budget, the Women’s Budget Statement will detail the Government’s financial commitments and actions taken to implement the goals of Working for Women.

The focus will be on five main priorities:

  1. Gender-based Violence:
    • Urgent actions through the National Plan to End Violence against Women and Children 2022–2032.
    • Permanent financial support through the Leaving Violence Program for survivors.
    • Increased funding for crisis and transitional accommodation for women and children fleeing domestic violence.
  2. Unpaid and Paid Care:
    • Providing cost-of-living relief to women taxpayers and reducing disincentives to workforce participation through legislated tax cuts.
    • Additional energy bill relief and increased Commonwealth Rent Assistance.
  3. Economic Equality and Security:
    • Investments in women’s health to address higher health costs and ensure greater choice and access.
    • Reforming HELP debt indexation and introducing a new Commonwealth Prac Payment.
    • Introducing a superannuation guarantee equivalent payment on Government-funded Paid Parental Leave from 1 July 2025.
    • Funding wage increases for aged care workers and early childhood educators.
  4. Health:
    • Focused investments to address the unique health challenges faced by women.
  5. Leadership, Representation, and Decision Making:
    • Introducing the Building Women’s Careers program to boost women’s participation in construction, clean energy, advanced manufacturing, and technology sectors (as part of the Future Made in Australia initiative).

The Women’s Budget Statement highlights the Government’s commitment to gender equality, outlining comprehensive measures to support women across various aspects of life, from health and safety to economic participation and leadership.

Safe and Responsible A.I.

The 2024 Federal Budget allocates $39.9 million over five years from 2023–24 to ensure the safe and responsible adoption of artificial intelligence (AI) technology. Here’s how the funds will be used:

  • National AI Centre (NAIC): $21.6 million over four years from 2024–25 to establish a reshaped NAIC and an AI advisory body within the Department of Industry, Science and Resources.
  • Industry Analytical Capability and Policy Development: $15.7 million over two years from 2024–25 to support industry capabilities and coordinate AI policy development, regulation, and engagement across government. This includes reviewing and strengthening existing regulations in healthcare, consumer, and copyright law.
  • National Security Risks: $2.6 million over three years from 2024–25 to respond to and mitigate national security risks related to AI.

Additionally, the Digital Transformation Agency will develop and implement policies to position the government as a leader in the use of AI, with costs covered by existing resources.

These investments aim to foster a safe and responsible AI environment in Australia, ensuring technological advancements benefit society while addressing potential risks.

Quantum Computing Capability Development

The 2024 Federal Budget is committing $466.4 million through a financing package of equity and loans provided by Export Finance Australia to support PsiQuantum Pty Ltd. This investment aims to advance quantum computing capabilities in Brisbane, in collaboration with the Queensland Government.

Key Investments:

  • PsiQuantum Pty Ltd: $466.4 million for the construction and operation of quantum computing facilities and related industry and research development.
  • Government Oversight: $27.7 million over 11 years from 2023–24 allocated to the Department of Finance, the Department of Foreign Affairs and Trade, the Department of Industry, Science and Resources, and the Department of the Treasury to manage and oversee this investment.

Due to commercial sensitivities, specific financial details of the financing package are not publicly disclosed.

This initiative underscores the Government’s commitment to positioning Australia at the forefront of quantum computing, driving innovation, and fostering significant advancements in technology and research.

2023-24 Measures Not Yet Implemented

Several tax and superannuation policy decisions from the 2023-24 Budget are still pending implementation and are currently before Parliament. Here’s a summary of these proposals:

Pending Policy Decisions:

  • Instant Asset Write-Off: Increase the threshold from $1,000 to $20,000 for the 2024 income year. Senate amendments propose increasing it further to $30,000 and extending it to medium entities.
  • Small Business Energy Incentive: Provide a bonus deduction equal to 20% of the cost of eligible assets or improvements supporting electrification or efficient energy use for small and medium businesses.
  • Petroleum Resource Rent Tax (PRRT) Deductions Cap: Amendments to cap deductible expenditures related to petroleum projects.
  • Federal Administrative Review Body: Abolish the Administrative Appeals Tribunal (AAT) and establish the Administrative Review Tribunal.
  • Strengthening Tax System Integrity: Reforms to enhance the powers of tax regulators and strengthen regulatory arrangements.
  • Better Targeted Superannuation Concessions: Reduce tax concessions for individuals with Total Super Balances exceeding $3 million.
  • Non-Arm’s Length Expenditure for Superannuation Entities: Amendments to restrict the application of non-arm’s length expense rules for superannuation entities.
  • Objective of Superannuation: Legislate the objective of superannuation.

Consultation Phase Policy Decisions:

  • International Tax: Country-by-country reporting and global and domestic minimum tax.
  • Investment in Housing: Build-to-rent tax concessions.
  • Medicare and Lump Sum Payments: Exempt lump sum payments in arrears from the Medicare levy.
  • Strengthening Tax System Integrity: Review of tax regulator information gathering powers and regulation of accounting, auditing, and consulting firms.
  • Payday Super: Consultation process for payday superannuation.
  • Transfer Balance Credit Provisions: Amendments to the provisions for successor fund transfers.

Withdrawn Programs:

  • Modernising Business Registers Program: The Government announced it would not proceed with this program.

These measures reflect ongoing efforts to refine Australia’s tax and superannuation systems, ensuring they remain fair, efficient, and responsive to current economic challenges.

The Economy

Key Statistics

Here’s a quick overview of the key economic statistics from the 2024 Federal Budget, highlighting GDP growth, inflation trends, unemployment rates, wage growth, and business investment amid ongoing global uncertainties and domestic challenges.

  • GDP: Real GDP growth of 1.75% in 2023–24, with projections of 2% in 2024-25 and 2.25% in 2025-26.
  • Inflation: Expected to be within target by the end of 2024. The RBA predicts a return to the 2-3% target range by the second half of 2025, reaching the midpoint in 2026.
  • Unemployment: Currently at a 50-year low of 3.8%, with a high participation rate of 66.6%. Expected to rise but stay below pre-pandemic levels.
  • Wages: Fastest nominal wage growth in nearly 15 years in 2023-24, expected to soften to 3.25% in 2024-25 and 2025-26. Real wages projected to grow by 0.5% by June 2024.
  • Business Investment: Grew by 8.3% last year.

The first part of this decade has tested the resilience of the Australian economy with floods, bushfires, a global pandemic, and an international energy crisis affecting supply chains, energy prices, inflation, and interest rates. Despite these challenges, Australia faces ongoing global uncertainties, including persistent inflation in North America, slowing growth in China, recessions in the UK and Japan, and rising tensions in the Middle East and Eastern Europe.

Inflation and Cash Rate:

  • Inflation: Moderating but still high compared to the 2-3% target. Increased costs of living for Australian households.
  • Surplus and Inflation: The 2022–23 surplus helped reduce inflationary pressure, allowing for priority funding and debt reduction. However, more efforts are needed to lower inflation.
  • Cash Rate: Currently at 4.35%, raised by 0.25% on 7 November 2023 by the RBA to manage inflation. Higher interest rates are slowing economic growth and balancing demand with supply.

These measures reflect the Government’s ongoing efforts to stabilize the economy amidst global and domestic challenges, aiming to promote sustainable growth and financial stability.

Personal Income Tax Rates from 1 July 2024

The 2024 Federal Budget outlines the personal income tax rates for resident individuals, non-resident individuals, and working holiday makers for the 2023-24 and 2024-25 periods. This table highlights the changes in tax rates as part of the Government’s ongoing efforts to adjust the tax system and provide financial relief where needed.

Resident Individuals
Tax rate2023-242024-25
0%$0 – $18,200$0 – $18,200
16%$18,201 – $45,000
19%$18,201 – $45,000
30%$45,001 – $135,000
32.5%$45,001 – $120,000
37%$120,001 – $180,000$135,001 – $190,000
45%$45,001 – $120,000>$190,000
Non-resident individuals
Tax rate2023-242024-25
30%$0 – $135,000
32.5%$0 – $120,000
37%$120,001 – $180,000$135,001 – $190,000
Working Holiday Markers
Tax rate2023-242024-25
15%0 – $45,0000 – $45,000
30%$45,001 – $135,000
32.5%$45,001 – $120,000
37%$120,001 – $180,000$135,001 – $190,000

Timeline of Initiatives

The 2024 Federal Budget introduces a range of measures affecting various sectors, including individuals, businesses, tax-exempt entities, international entities, superannuation, and other areas. This table presents a clear timeline of when these budget measures will take effect, helping stakeholders understand the implementation schedule and plan accordingly.

Budget MeasureApplication date
Tax cuts have been legislated for all 13.6 million Australian
2024–25 and later income years
Increasing the Medicare levy low income thresholdsFrom 1 July 2023
Indexation on HELP debt to be capped to the lower of either the
CPI or the WPI.
1 June 2023
Instant asset write-off threshold temporarily increased to $20,000.From 1 July 2024 until 30 June 2025
Two time‑limited tax incentives to invest in new industries:
• Critical Minerals Production Tax Incentive to support
downstream refining and processing of Australia’s 31 critical
minerals to improve supply chain resilience
• Hydrogen Production Tax Incentive to producers of
renewable hydrogen to support the growth of a competitive
hydrogen industry
2027–28 to the 2040–41 income years
Extension and expansion of the Energy Bill Relief FundFunding for three years from 1 July 2024
All households will have $300 credit automatically applied to their
electricity bills and around one million small businesses will
receive $325 off their bills over 2024–25.
From 1 July 2024
Funding to support small business by:
• Improving payment times to small businesses
• Supporting mental health and financial wellbeing of small
business owners
• Ensuring confidence in the franchising sector
• Providing small business with better access to justice
Funding for four years from 2024–25
Proposed changes to the Producer Tax Offset to remove:
• The minimum length requirements for content
• The above-the-line cap of 20% of total qualifying production
2025–26 income year
Tax Exempt Entities
Extension of transitional reporting for charities and updates to
specifically listed DGRs
Strengthen the foreign resident CGT regime by:
• Clarifying and broadening the types of assets on which
foreign residents are subject to CGT
• Amending the point-in-time principal asset test to a 365-day
testing period
• Requiring foreign residents disposing of shares and other
membership interests exceeding $20 million in value to notify
the ATO, prior to the transaction being executed.
CGT events commencing on or after
1 July 2025
The Government will pay superannuation on Commonwealth
government-funded PPL
Births and adoptions on or after 1 July
Funding to support the progression of the Government’s
workplace relations agenda, including:
• Pursuing unpaid superannuation entitlements owed by
employers in liquidation or bankruptcy from 1 July 2024
• Supporting workplaces to implement policy changes such as
the introduction of payday superannuation.
Funding for four years from 2024–25
Funding to support the delivery of Government priorities in the
Finance and Treasury portfolio including:
• Implement the 2023–24 Budget measure Better Targeted
Superannuation Concessions for members of the
Commonwealth defined benefit superannuation schemes
• SuperStream Gateway Network Governance Body
Funding over four years from 2024-25
Extend the Tax Avoidance TaskforceFunding over two years from 1 July 2026
Extend the Personal Income Tax Compliance ProgramFunding for one year from 1 July 2027
Extend the Shadow Economy Compliance ProgramFunding over two years from 1 July 2026
ATO funding to strengthen its ability to detect, prevent and
mitigate fraud against the tax and superannuation systems
Funding over four years from 1 July 2024
Funding for the ATO for various matters including:
• Requirements of existing and new child care providers
(relating to the Child Care Subsidy Program)
• Improving the Government’s Digital ID, myGovID and other
• Data-matching pilot between the Department of Home
Affairs and the ATO
• Overseeing / operating the secure eInvoicing network
Other Measures
Funding to strengthen Australia’s Anti-Money Laundering and
Counter-Terrorism Financing Act 2006, to enhance Australia’s
ability to detect and disrupt illicit financing
Funding over four years from 2024–25
Women’s Budget Statement — various measures that focus on
four priorities
Funding to modernise regulatory frameworks for financial services
to improve competition and consumer protections for services
enabled by new technology.
Funding over four years from 2024–25
Funding to implement a social security means test treatment for
the military invalidity payments affected by the Federal Court’s
decision in FCT v Douglas [2020] FCAFC 220.
Funding over five years from 2023–24
Funding to deliver key aged care reforms and to continue to implement recommendations from the Royal Commission into
Aged Care Quality and Safety.
Funding over five years 2023–24
New Aged Care Act — deferred commencement date1 July 2025
Social security deeming rates will freeze at their current levelsUntil 30 June 2025
Increased flexibility for recipients of Carer Payment —the existing
25 hour per week participation limit will be amended to 100 hours
over four weeks.
From 20 March 2025
Commonwealth Rent Assistance maximum rates to be increased
by 10%
20 September 2024
Eligibility for the existing higher rate of JobSeeker payments has
been extended
20 September 2024
Amendments to previously announced measures:
• Australian plantation forestry entities are exempt from the
new earnings-based test, thin capitalisation rules
• Giving the Commissioner a discretion not to use a taxpayer’s
refund to offset old tax debts – where the old tax debt was
put on hold before 1 January 2017
Extending income tax exemption to World Rugby and/or related
entities in relation to income from Rugby World Cup events for the
2023–24 to 2030–31 income years (incl.)
Deferring the start date for Tax Integrity — expanding the general
anti-avoidance rule in the income tax law
Income years starting on or after the day
the amending legislation receives Royal
Changing the start dates for certain components of the
Streamlining excise administration for fuel and alcohol package
The day after Royal Assent
Measures not proceeding:
• Denying deductions for payments relating to intangibles held
in low- or no-tax jurisdictions measure — announced in the
2022–23 October.
Previous Government’s 2019 –20 Budget measure Black Economy
– strengthening the Australian Business Number system.


The 2024 Federal Budget is a testament to the Government’s commitment to fostering economic growth, promoting gender equality, and ensuring financial stability amidst global uncertainties. With substantial investments in key areas such as superannuation, digital assets, renewable energy, and support for small businesses, this budget addresses both immediate needs and long-term goals.

Key measures include:

  • Tax cuts and increased Commonwealth Rent Assistance
  • Establishment of the Leaving Violence Program
  • Enhancements in aged care support
  • Expansion of the instant asset write-off for small businesses
  • Significant funding to combat greenwashing and manage sustainable finance markets
  • Development of quantum computing capabilities in partnership with the Queensland Government

Additionally, the Women’s Budget Statement marks a historic step towards gender equality, with focused investments in economic security, health, and leadership for women. Other critical initiatives include:

  • Extension of the Fair Entitlements Guarantee Recovery Program to cover unpaid superannuation
  • Recalibration of anti-fraud strategies to ensure fairness and integrity in the financial system

As Australia navigates the challenges of a dynamic global landscape, the 2024 Federal Budget provides a robust framework for resilience and growth. By prioritizing innovation, sustainability, and social equity, this budget aims to create a more prosperous and inclusive future for all Australians.

Need Help?

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