Income tax cuts in Australia 2016: Why you won’t get promised lower rate today

IT WAS about the only sweetener in the Budget, but a tax cut due to come into effect today is in limbo thanks to the Turnbull’s eagerness to get to the polls.

Prime Minister Malcolm Turnbull hasn’t delivered on his promised tax cuts. Picture: Jason Edwards

IT was about the only sweetener in the Turnbull Government’s budget, and today was supposed to be the delivery date.

But tax cuts for higher earning Australians are on hold, leaving more than three million voters in tax limbo on the eve of the Federal Election.

In handing down its May Budget, the Coalition promised a small slice of income tax relief to Australians earning more than $80,000 a year.

The proposal specified the income rate over which earners would have begin paying 32.5 per cent tax, would be raised from $80,000 to $87,000, effectively giving just more than three million tax payers a $6-a-week tax break.

The cut was meant to kick in today, but thanks to Prime Minister Malcolm Turnbull’s eagerness to get to the polls, it wasn’t legislated in time.

An Australian Tax Office spokesman told news.com.au because the government had gone into caretaker mode after calling the election, no legislation could be moved to put the tax cut into place.

“On 9 May 2016 the Australian Government assumed a caretaker role. At that time relevant legislation for the small business tax cut were not introduced. These changes will be a matter for the incoming government to decide,” the spokesman said in a statement.

The ATO said the introduction of the measures would have to be legislated by the incoming government.

“The ATO will at the time consider the administrative approaches available to implement.”

Mr Turnbull has said his government would move to implement the tax cuts as a priority if elected.

Also in limbo is a proposed tax cut to small and medium sized businesses which were supposed to have their tax rate cut to 27.5 per cent on July 1 and get another year to claim instant deductions for equipment purchases worth up to $20,000 each.

An ATO spokesman said: “The ATO’s current guidance for small business on tax rates is based on the current enacted law. If there are changes to the law in the future, the ATO’s guidance will be updated.”

In other changes due to come into effect today, according to AAP, higher electricity prices are on the cards for many households, with hikes of about 10 per cent expected in NSW and 3.43 per cent in Tasmania.

Sick people needing an ambulance in NSW will also be slugged with a $364 call out fee, plus an extra $3.29 per kilometre.

Controversial lockout laws will be enforced in Queensland, with reduced hours for liquor service and restrictions on the serving of shots, spirits and pre-mixed drinks after midnight.

In South Australia, smokers will be banned from lighting up in alfresco dining venues at all pubs, clubs, cafes, restaurants and fast-food outlets.

More than 2800 injured South Australian workers also face increased medical expenses with changes to the workers’ compensation scheme to cut their benefits.

But hundreds of thousands of disabled people, their families and carers across most of the country will begin to receive more support with the start of the National Disability Insurance Scheme.

Workers in the Northern Territory can also claim compensation for 12 additional work-related diseases, including hepatitis C and melanoma, without having to prove they were directly caused by their job.

Those catastrophically injured in accidents in Western Australia will be entitled to treatment, care and support for the rest of their lives under new motor vehicle insurance cover.

And in Victoria, hoverboards that fail new safety standards will be banned while police have new powers to ban convicted criminals associating with each other, even online.