Last night Treasurer Joe Hockey announced the 2015-16 Federal Budget. With a focus on getting Australians out into the workforce and ‘turbocharging’ our economy, new benefits have been introduced for young and disadvantaged Australians, small business operators, families and pensioners. While you might be too busy worrying about your own budget and finances, we have put together a cheat sheet to help you see how the Australian Federal Budget will impact on your life.
Young or Disadvantaged Australians
Youth unemployment figures have shocked the government into introducing new incentives and schemes to make young and disadvantaged Aussies a more attractive employee. Businesses can access up to $6500 in wage subsidies over 12 months. They have also made work experience readily available to job seekers and people under 25 will only have to wait four weeks before receiving dole payments as opposed to the planned 6 month waiting period for anyone under 30.
The government has vowed to simplify the means testing for Youth Allowance making it easier for young people to get, especially those from regional areas. They also plan on distributing more money through youth allowance so individual payments may go up.
Small Business Owners
Drawing on his own experience growing up in a small business family, Joe Hockey announced some huge changes for any Aussies looking to have a go. Small Businesses are immediately able to claim 100% tax deduction on assets up to $20,000. The government has also slashed red tape while offering generous tax concessions to encourage small business owners to create jobs. Tax cuts are also a huge winning point for small businesses with the tax for small corporations being cut from 30% to 28.5% and small unincorporated businesses get a tax cut of 1.5%
As of 2017, childcare centres will receive direct government payments, reducing the costs parents will have to pay upfront. It is estimated that families earning between $65,000 and $185,000 will be about $30 a week better off. Families can access up to 100 hours of subsidised childcare per fortnight depending on hours worked or used for training and study.
Stay-at-home parents are encouraged to re-enter the workforce with subsidies slashed in this years budget. For families with a household income over $65,000, both parents must complete at least 8 hours of work, training or study a fortnight to receive any childcare subsidies. Households with a stay-at-home parent and earning less than $65,000 will still receive 12 hours of subsidised childcare.
A two year pilot program estimated to cost $246 million will see shift workers such as nurses and police officers able to access subsidised nannies.
Expecting parents are now only eligible for the tax-payer funded 18 week minimum wage maternity leave if they aren’t eligible for employer-funded paid parental leave. The only reason a parent will receive both is if the employer-funded leave doesn’t equal 18 weeks minimum wage in which case the tax-payer funded leave with make up the difference.
The government will no longer support large families with the abolishment of the Family Tax Benefit A.
A focus on making lifesaving treatments affordable has seen some changes to the Pharmaceutical Benefit Scheme (PBS). Over the counter medicines, such as paracetamol, aspirin and antacids have been removed from the scheme to make way for more expensive items. The expected $3 billion in savings from removing certain medicines will make way for treatments for melanoma, breast cancer and blindness.
Something called the “Netflixâ€ Tax has been introduced allowing the government to extend the GST to ‘intangible’ online products such as Netflix, eBooks, movies and games.
Employers can access up to $10,000 a year in wage subsidies for hiring people who are over 50 and have been unemployed for 6 months. This is expected to make it easier for over 50’s to stay in the work force.
Pensions will now increase twice per year, every year but the government has changed the thresholds to determine how much pension you receive. Even if you are no longer eligible for pension payments, you will still receive the pension discount and healthcare card.