Peter Dutton’s shock tax cut move to outgun PM

Peter Dutton will pledge to deliver a one-off tax cut of up to $1,200 for middle income earners as it’s revealed when Aussies can get the cash.

Peter Dutton will pledge on Sunday to deliver a one-off tax cut of up to $1,200 for middle income earners but you will have to wait until July, 2026 to get the cash.

News.com.au can reveal that the tax cut plan effectively brings back what became known colloquially as the Lamington – the Low and Middle Income Offset (LMITO).

It would see eligible Australians earning up to $144,000 receive up to $1,200 in tax relief when they lodge their tax return.

People earning over $144,000 will miss out on tax relief under the proposed changes.

In a shock move designed to outgun the Prime Minister Anthony Albanese, the Liberal leader will unveil the promise at his campaign launch in Brisbane on Sunday.

Despite ruling out tax cuts a fortnight ago, the Liberal leader has backflipped as the Prime Minister continues his comeback in the polls.

Peter Dutton to offer surprise tax cut to workers earning under $144,000 a year. Picture Thomas Lisson / NewsWire

But just like the fuel excise cut, the measure will be temporary and will not be offered on an ongoing basis.

“Australians are hurting – and Anthony Albanese isn’t listening,” Mr Dutton told news.com.au.

“The Coalition is stepping up with a plan that provides real help.

“Families are getting smashed under the Albanese Government, and they need help now.

“A Coalition government will first provide help to families by cutting fuel by 25 cents a litre – a saving of about $1,500 a year for a two car family. And then by giving back up to $2,400 per family while we clean up Labor’s mess. Labor’s 70 cents a day is a bandaid on a bullet wound.

“Our Cost of Living Tax Offset will put more money back into the pockets of millions of Australians at a time when they’re being crushed by skyrocketing grocery bills, rent, mortgage repayments and insurance costs.

“Labor’s so-called tax cut – just 70 cents a day – is a slap in the face to hard working Australians and an insult to families trying to make ends meet.

“It shows just how out of touch Mr Albanese really is.”

The tax cut plan effectively brings back what became known colloquially as the Lamington – the Low and Middle Income Offset (LMITO).

Despite ruling out tax cuts a fortnight ago, the Liberal leader has backflipped as the Prime Minister continues his comeback in the polls. Picture Thomas Lisson / NewsWire

Labor’s proposed tax cuts would also force voters to wait for relief and would not come into force until next year.

The Liberals’ proposed tax cuts are not ongoing because the Coalition argues to do so would not be fiscally responsible.

“Labor’s big spending agenda is fuelling inflation and driving up the cost of everything,’’ opposition treasury spokesman Angus Taylor said.

In a shock move designed to outgun the Prime Minister Anthony Albanese, the Liberal leader will unveil the promise at his campaign launch in Brisbane on Sunday. Picture: Mike Bowers/AFP

“The Coalition’s approach is different – we will provide temporary and targeted cost of living relief while we get our economy back on track. We will restore responsible economic management, deliver a plan to lower electricity and gas bills, and restore prosperity for working Australians.

“This offset is part of our comprehensive plan to rebuild the economy, ease cost of living pressures, and reward hard work.”

Around 85 per cent of taxpayers will benefit from the offset and roughly half of all taxpayers will receive the maximum offset of $1,200.

The cost of the one-off offset will be $10 billion.

The tax cut will be worth up to $1200 when you lodge your tax return – but only people earning between $48,000 and $104,000 will get the max

It will be delivered in July, 2026 when you lodge your return.

Brain explosion on tax

Jim Chalmers accused the Coalition of “a brain explosion” after Liberal leader refused to back his $17 billion tax cut last month.

The Treasurer slammed the Liberal Party for not backing in the tax cuts that will start at $5 a week from July, 2026 before rising to $10 a week the following year.

But it’s the modest nature of the initial tax relief that is coming under the microscope this morning as Mr Chalmers and the PM hit the campaign trail.

Despite costing $17 billion over the next five years, the tax cuts start at just $5 a week.

Labor’s tax relief is delivered to all through a reduction in the tax rate for all earnings between $18,200 and $45,000.

What that means is that everyone gets the same $268 tax cut next year if they earn over $45,000. It’s a little less generous for earnings between $18,200 and $45,000.

Casual workers earning under the tax-free threshold of $18,200 get no tax cut at all.

“But if you earn $1 million a year you still get this, don’t you?,’’ Barr asked. “Why didn’t you means test it?.”

Speaking on the Today show the PM defended the tax cuts as responsible.

“This is modest,’’ the Prime Minister said.

Originally published as Peter Dutton’s shock tax cut move to outgun PM