Last night the Government handed down the budget for the 2024-25 fiscal year.
The main themes of this budget were:
- Cost of living relief
- Investing in a Future Made in Australia
- Building more homes for Australians
Following a $22.1bn surplus achieved in 2022-23, it was announced that a $9.3bn surplus is now expected in the current financial year – a significant improvement from the forecasted deficit. However, this is tempered with a budgeted $28.3 budget deficit for the upcoming 2024-25 financial year.
Annual inflation is forecast to fall to 2.75% in 2024-25, down from 3.5% in 2023-24 and 6% in 2022-22.
Key budget highlights include:
- Stage 3 tax cuts confirmed in the 2024-25 Australian Federal Budget. Starting from 1 July this year, the Government will:
- Reduce the 19% tax rate to 16%
- Reduce the 32.5% tax rate to 30%
- Increase the income threshold above which the 37% tax rate applies from $120,000 to $135,000
- Increase the income threshold above which the 45% tax rate applies from $180,000 to $190,000.
- A 12-month extension to the $20,000 instant asset write-off for small business taxpayers. This means Australian businesses with an annual turnover below $10 m can continue to immediately write-off depreciable assets for purchases up to the value of $20,000 through to 30 June 2025.
- Energy relief will provide energy savings of up to $300 for households and, $325 for small businesses. An estimated one million eligible small businesses will benefit from this $325 reduction on their power bills.
- Measures to deliver more properties to build, rent and buy under the Homes for Australia plan. This includes $1 bn under the National Housing Infrastructure Facility, $1.9 bn Rent Assistance Increase and, an additional $1.9 bn in concessional loans that will be provided to community housing providers and other charities to support the delivery of new social and affordable homes – great news for our property development and construction clients.
- Commitment to better connect remote communities to essential services committing $101.9 m to upgrade regional airports and remote airstrips, opening up new market opportunities for agricultural products, both domestically and internationally – contributing to the overall development and resilience of rural communities. A further $40 m will be invested to support the roll-out of additional community wi-fi in remote and regional Australia.
Please contact your Boyce advisor if you would like to discuss how this budget will affect your business and explore any potential benefits.
