Tax and Structures

2. From 1 July 2022:

• the top threshold of the 19% personal income tax bracket will increase from $41,000 to $45,000
• the low income tax offset (LITO) will increase from $645 to $700 (and decrease at a rate of 5 cents per dollar between taxable incomes of $37,500 and $45,000, and decrease at a rate of 1.5 cents per dollar between taxable incomes of $45,000 and $66,667)

The proposal has been legislated.

3. From 1 July 2024-25, the 32.5% marginal tax rate will reduce to 30%. Importantly, this proposed measure combined with the already legislated abolition of the 37% marginal tax rate in 2024-25, is projected to see 94% of taxpayers pay a marginal tax rate of 30% or less by 2024-25. This is what it will look like for taxpayers with the following taxable incomes:

• ≤$18,200, nil tax
• from $18,201 to $45,000, nil plus 19% for each dollar over $18,200
• from $45,001 to $200,000, $5,092 plus 30% for each dollar over $45,000
• $200,001+, $51,591 plus 45% for each dollar over $200,000

The proposal has been legislated.