Morrison’s tax cuts: What it means for you

Millions of Aussies will receive a $1080 boost to their hip pocket after the Morrison government locked in support for its tax cuts. Here’s when you can expect to get your cash injection.

Millions of Australian workers will get up to $1080 extra back in tax within the next week after Scott Morrison secured crossbench support for his $158 billion tax cuts.

The personal income tax cuts will now pass the Senate tonight in full.

Debate began on the package just after 9.30am.

Labor ‘mocking Aussies’ with tax plan

Tax relief win a step closer for SA workers

Tax cuts close for millions of Aussies

Senators have confirmed they will back the package. Picture: iStock

Labor still plans to push for the second stage of the tax relief to be brought forward and the third part put on ice, but it acknowledges it won’t be successful.

Shadow cabinet decided this afternoon that in that case, it would wave the plan through.

“We do not want the circumstances whereby an economy that is struggling prevents people getting a tax benefit of up to ... $1080,” Opposition Leader Anthony Albanese told reporters.

“The economy needs that, the economy needs that now.”

Labor will review its position on the third stage of the plan, which doesn’t start until 2024/25 but would be legislated now, closer to the next election in three years’ time.

Centre Alliance senators issued a statement this morning confirming they would back the package after securing a commitment from the government to act on gas market concerns.

Tasmanian senator Jacqui Lambie will also back the plan after yesterday calling for the federal government to wipe-out the state’s $157 million social housing debt.

Scott Morrison in Canberra. Picture Kym Smith

The government has previously secured independent senator Cory Bernardi’s support.

Australians will earning up to $120,000 will receive up to $1080 extra back in tax when they file this year’s return or up to $2160 for dual income families.

Stage two of the plan will increase the 19 per cent tax rate’s threshold from $41,000 to $45,000 from 2022, delivering permanent relief for more low income workers.

A whopping 94 per cent of Australian workers will get tax relief under stage three, which will lower the tax they pay from 32.5 cents to 30 cents from 2024-25.

Senator Lambie confirmed today she would back the full package despite having concerns about whether the economy could afford the $95 billion cost of Stage 3.

Senators Jacqui Lambie confirmed today she would back the tax cuts. Picture Kym Smith

Australians needed urgent hip-pocket relief, she said.

“I’m not sitting around on this for another four or five weeks while we play argy-bargy,” Senator Lambie added, saying Australians had had a “gut full” of delays from Canberra.

The Tasmanian senator has received no firm deal from the government that it will wipe out the state’s social housing debt but believed they would take some action.

She also added the third stage of the tax cuts might need to be rolled back before 2024-45 if the nation couldn’t afford it.

Centre Alliance confirmed their support for the tax cuts in a statement this morning.

Senator Jacqui Lambie (centre) sits with Centre Alliance Senators Rex Patrick (left), Stirling Griff and Centre Alliance MP Rebekah Sharkie. Picture: AAP

“After lengthy negotiations with the government to address concerns that Centre Alliance has about rising energy costs, and particularly the high electricity costs in South Australia, Centre Alliance has agreed to support the Government’s personal tax cuts legislation,” it said.

“Supporting the tax cuts will reward Australian taxpayers and provide a stimulus to the economy that almost all economists have called for, including the Reserve Bank Governor.”

The party confirmed it had locked in a deal with the government for short and long term reforms on gas market concerns, which include changes to the Australian Domestic Gas Security Mechanism “to deal with current pricing, market transparency measures, measures to deal with the monopoly nature of East Coast gas pipelines.”

Labor appears open to backing the package tonight but will first try to amend the package to bring stage two of the tax cuts forward to 2019 and to shelve stage three over concerns about the economy.

“We’ll still put all of our effort into our amendments,” Shadow Treasurer Jim Chalmers told ABC News.

“If it is the case that the Senate rejects those amendments, if the Senate supports the Government’s package, then we’ve been saying for some time now that we’ll consider our options at that point.

“We’ll have the appropriate discussions and we’ll have more to say about it later on today.”