How much extra cash you can expect when tax cuts begin on July 1

Changes set to come into effect from Monday will mean more money in the pockets of most Australian taxpayers.

Stage 3 tax cuts were finalised in May’s federal budget, as well as a number of measures to combat the rising cost of living.

Under the stage 3 tax cuts, taxpayers will receive an average tax cut of $1888 or $36 per week in 2024-25.

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From the start of the new financial year on July 1, the 19 per cent tax rate will be reduced to 16 per cent and the 32.5 per cent rate down to 30 per cent.

The income thresholds will also be raised for the two highest tax brackets.

Low- and middle-income workers will see the most benefit, while workers earning $150,000 or more will notice a more modest tax cut than what was offered under the initial package.

By 2034-35, someone earning an average income will pay $21,915 less tax.

Other cost-of-living measures announced in the budget last month cover energy and Medicare relief, as well as an extension to eligibility for higher JobSeeker payments.

The government has committed $3.5 billion in energy relief, including extending the current relief scheme past the 2023-24 financial year.

The current relief scheme gave five million eligible households up to $500 off their energy bills and one million eligible small businesses up to $650 in relief.

From July 1, a new $300 payment will be offered to all Australian households instead.

Energy companies will apply $75 credits to each quarterly power bill under the rebate scheme.

From July 1, more than 10 million households will receive rebates on their energy bills, while about one million small businesses will receive $325.

The government has also increased the Medicare levy low-income thresholds for 2023-24, allowing more than one million low-income taxpayers to continue to be exempt from the levy or pay a reduced rate.

About 876,000 income support recipients, including about 450,000 age pensioners, are due to benefit from the government freezing social security deeming rates for financial investments at the current rate until June 30, 2025 to help manage cost-of-living pressures.

The government is also providing support for Australians with additional barriers to finding work by providing $41 million to extend the eligibility for the existing higher rate of JobSeeker.

This is expected to provide a boost of at least $54.90 per fortnight to eligible recipients who can only work up to 14 hours per week.

Superannuation will now be paid on government-funded paid parental leave, after the government committed $1.1 billion to the measure in the budget last month.

From July 1, 2025, eligible parents will receive 12 per cent superannuation or about $106 a week on their publicly funded paid parental leave.

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