Changes to personal tax rates
The tax-free threshold is set to increase to $18,200 from 1 July 2012. But the associated changes to marginal tax rates means that anyone earning over $80,000 misses out on a tax cut.
The change in the threshold and rates are summarised in the table below.
|
Current |
2012–13 | ||
|
Threshold ($) |
Marginal Rate |
Threshold ($) |
Marginal Rate |
|
0 – 6000 |
0 |
0 – 18,201 |
0 |
|
6,001 – 37,000 |
15% |
18,201 – 37000 |
19% |
|
37,001 – 80,000 |
30% |
37,001 – 80,000 |
32.5% |
|
80,001 – 180,000 |
37% |
80,001 – 180,000 |
37% |
|
180,001 and over |
45% |
180,001 and over |
45% |
The maximum low-income tax offset (LITO) will reduce from $1,500 to $445. It will taper off at a rate of 1.5% once income reaches $37,000.
The changes in tax rates and LITO means that an adult resident taxpayer will not be liable to pay income tax until they earn $20,543 or more. This is an increase from the current level of $16,000.