Budget 2018 : The Big Ticket Items In This Year's Budget Explained
It's a safe move from the Treasurer, but there's still heaps of numbers to crunch.
What you need to know
- The first tax cuts will start in July this year
- Focus on medicines and mental health
- Older Australians get more funding
breakdownIt's been called an election budget for weeks, and for good reason.
Scott Morrison's third federal budget aims to win over nearly everyone in the country, with the election due by May 2019.
There's a seven-year income tax cut plan, more money for baby boomers and the budget will be back to surplus one year earlier than expected in 2019/20.
Plus, the deficit is forecast to be $14.5 billion and that's set to be paid back within two years.
There's heaps more in this year's Budget, of course. Here's what you need to know.
The big ticket item with a tiny impact.
Morrison announced a three-step personal income plan that will come into effect from 1 July 2018.
Step one will see over 10 million Australians in the low to middle income earning bracket receive a tax cut of $530 annually -- or just over $10 a week in tax relief.
Step two involves the 32.5 percent tax bracket will also be lifted to $90,000 which will prevent 200,000 workers from moving into the 37 percent bracket.
Annual income Tax cut (per year)
- Up to $37,000 up to $200
- $37,000 - $48,000 up to $530
- $48,000- $90,000 $530
If the government is still around in 2024-25, step three will be executed. That will see the 37 percent tax bracket disappearing altogether.
If this plan is pulled off in its entirety, 94 percent of Australians will be paying 32.5 cents to the dollar in tax.
The Coalition will also keep the proposed large company cuts despite lack of support by the parliament.
An extra $24.5 billion has been allocated to infrastructure in this budget alone and the total Government spend is $75 billion over 10 years. The cash is set to be used on projects around the country to ease congestion and reduce travel times.
In his speech to Parliament, Morrison announced a $1billon Urban Congestion Fund, which aims to aid current state projects and ease traffic flow.
$400 million will be invested into the Port Botany rail line and the passing loop at Cabramatta in Sydney and $5 billion will be invested to help construct the rail link between Melbourne's Tullamarine airport and the city.
The budget will also include a $3.2 billion infrastructure package for Western Australia. This money will be allocated to road projects, hospitals, and water projects, and $1.05 billion will be allocated to the state's Metronet system.
Queensland is also expected to receive a package that will allocate $800 million to a Sunshine Coast railway upgrade and $1 billion to an upgrade of the M1 motorway.
$9.3 billion has been committed to building the Melbourne to Brisbane Inland Rail.
More than 14,000 high-level home care packages will be available to older Australians so they can live at home for longer. This will relieve some pressure on nursing homes and other aged care services.
There will also be 13,500 new aged care places created and rural care providers will see a $40 million funding boost.
There will also be $102.5 million available for programs that manage mental health issues, like loneliness and depression in older people.
Mature-aged workers and their employers will also get a funding boost. $10,000 subsidies will be allocated to employers who take-on older workers and a $2,000 incentive is available for mature-aged workers who wish to reskill and retrain.
Mental Health And The PBS
The 2018 Budget includes $1.4 billion for additional medications on the Pharmaceutical Benefits Scheme (PBS). These include medicines for spinal muscular atrophy, breast cancer, refractory multiple myeloma and relapsing-remitting multiple sclerosis as well as a new medication to prevent HIV.
There is also a focus on mental health, with call service Lifeline receiving an additional $33.8 million to ensure more calls are answered and staff training is supported. Head To Health is also receiving $4.7 million in funding and life development organisation The Junction Club House is receiving $500,000.
Suicide prevention is another focus in the mental health space, where $37.6 million is being allocated to improve follow-up care for people discharged from hospital after a suicide attempt. SANE Australia will get $1.2 million to deliver a suicide prevention campaign.
$535.80 million will go to improving the water quality, managing crown-of-thorns starfish and boosting restoration efforts of the Great Barrier Reef. The government has described this as the single largest conservation investment for the reef in Australia's history.
"We'll be improving the monitoring of the reef's health and the measurement of its impacts," Environment Minister Josh Frydenberg said in April.
"The more we understand about the reef, the better we can protect it."
The budget also includes a $50 million commitment to building an Australian space agency. This money will be allocated as 'seed funding' -- a way to offer an investor a stake in a business in exchange for money. It is understood contributions from the private sector will provide most of the funding required to establish the agency.
The government is yet to announce where the agency will be located.
Tobacco Task Force
Combatting illicit tobacco will make the Government $3.6 billion over the next four years. The crack down will target the three main sources of illicit tobacco in Australia -- smuggling, domestic production and leakage from licenses warehouses.
A specialised task-force will be set up to manage the illegal sale of tobacco that escapes duty each year.
The Australian Tax Office will also be given additional powers to charge additional taxes on tobacco when it enters the country and the policy is also expected to include the requirement to obtain a permit to import tobacco.
Gold Coast Film Boost
$140 million will be set aside from 2019-20 as a location incentive to attract film production to the Gold Coast. The proposal will almost double the location offset rate to 30 percent and will be made available from July 1, 2018.
Captain Cook Commemoration
$48.7 million over four years will be set aside to fund a commemoration of the 250th anniversary Captain James Cooks' first voyage to Australia. The package will be used to fund events and exhibitions, including a digital platform, education materials and a replica of HMB Endeavour.