Federal Budget 2008 And Families
By Sandy Naidu | June 23, 2008
The federal budget 2008 has been received with mixed reaction…Here are the new rules/changes that affect the families….Read through and see how you are affected:
Medicare Levy Surcharge Threshold Increase
Currently the government charges a levy for people who earn a certain amount but don’t take private health insurance. From July 1st 2008, the threshold for the income levels will increase.
Current Income Level Thresholds For Surcharge are -
Single Person - $50,0000 per annum
Family/Couple - $100,000 per annum combined income
New Income Level Thresholds For Surcharge are -
Single Person - $100,0000 per annum
Family/Couple - $150,000 per annum combined income
Currently the government also gives you a rebate if you take up private health insurance. The reason for the current income threshold increase will save the government money. The increased thresholds will encourage a lot of people to give up private health insurance (couples who earn between 100k and 150k and singles who earn between 50k and 100k who currently have private health insurance will give it up as they will not charged a levy anymore) and as a result government will save money (as it doesn’t have to pay rebates to people who will be giving up private health insurance).
This might save government money but it will have an adverse affect on the public health system and will put pressure on the private health insurers to increase premium costs. We already had one premium increase - looks like there will be a few more on its way.
Family Tax Benefit
You can read about the changes to the family tax benefit in my recent blog post.
Means Tested Baby Bonus
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From 1 January 2009 baby bonus will be means tested - After the birth of the baby, families have to tell Centrelink what they think their income will be in the next 6 months (total family income - salaries, money from investments - basically all income). If the income is less than $75,000 then they will be eligible for baby bonus. The bonus will be paid in 13 fortnightly payments. |
Centrelink says that anyone who fraudulently underestimates their income will be forced to pay the bonus back.
From 1 July 2008 the bonus will increase from $4,258 to $5,000 and from there after Government will index the payments by the Consumer Price Index each subsequent year on 1 July.
Child Care Tax Rebate
From July 1 2008, the child care rebate will be increased from 30% to 50%. The maximum out of pocket expenses claimable will increase from $4,354 to $7,500 per child, per year. And also the rebate money will be paid quarterly rather than annually. This is definitely going to be good news for a lot of families.
Education Cost Tax Refund
Only families eligible for Family Tax Benefit Part A will be eligible for this refund. Eligible families can now claim 50 per cent tax refund when they spend up to $750 on education materials for each primary school child and $1500 per secondary child.
Personal Income Tax Cuts
Here are the new income tax rates:
0 to 6,000 - 0%
6,001 to 34,000 - 15%
34,001 to 80,000 - 30%
80,001 to 180,000 - 40%
Over 180,000 - 45%
Related Posts:
- Child Care Costs For Families - Federal Budget 2008/2009
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To reduce the burden on public health system, the federal government implemented two initiatives to encourage us to take up private health insurance. The...
Topics: Taxes |
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