Budget 2018: Australia on track to build a stronger economy

The Commonwealth Treasurer, Scott Morrison, delivered his second Budget in Canberra on Tuesday, 8 May 2018.

The Government is sticking to its plan for building a stronger economy for Australia. The Australian economy, now in its 27^th year of consecutive growth, continues to strengthen and is shaking off the downturn in mining investment.

Under the Government’s economic plan, more jobs are being created, investment is rising, and the Budget is strengthening. To ensure the benefits of stronger economic growth can continue to be secured and shared, the Budget will provide tax relief to encourage and reward working Australians, back businesses to invest and create more jobs, guarantee the essential services that Australia’s rely on and keep Australian’s safe, all while ensuring the Government lives within its means.

Keep backing business to invest and create more jobs

The Government’s national economic plan is delivering a stronger economy, record jobs growth and a recovery in non-mining business investment. To make Australia’s businesses more competitive and hire more staff, the Government is driving economic growth by legislating tax cuts for all businesses, prioritising small to medium businesses, delivering infrastructure that supports industries and jobs, and targeting incentives to promote research, development and new technology.

• Legislating lower taxes for Australian businesses
• Extending the $20,000 instant asset write"’off
• $75 billion for transport infrastructure
• Building a stronger and smarter economy
• A 21st century Medical Industry Growth Plan
• Supporting Australia’s international competitiveness and exports in agriculture and the defence industry

Tax relief to encourage and reward working Australians

Tax relief for low and middle-income earners is the first priority of the Government’s seven-year plan to make personal income tax in Australia lower, fairer and simpler. By 2024"’25 around 94 per cent of taxpayers are projected to face a marginal tax rate of 32.5 per cent or less.

• Seven-year personal income tax plan for lower, fairer and simpler taxes
• Immediate relief for low and middle-income earners
• Tackling bracket creep
• Helping families with cost of living pressures
• Simplifying the personal tax system by abolishing the 37 per cent tax bracket
• No increase in the Medicare Levy because a stronger economy delivers stronger revenue

Guaranteeing the essential services that Australians rely on

The Government has pledged to ensure that all Australians have access to high-quality, affordable, essential services at every stage of their lives. The 2018 Budget includes record funding for schools and a comprehensive approach to aged care with guaranteed funding for disability services.

• Supporting more choices for a longer life
• Continuing to guarantee the Medicare Benefits Schedule
• Backing the Gonski Review
• Record funding for a new hospital agreement
• Fully funding the National Disability Insurance Scheme
• Lower energy bills and more investment to keep the lights on

Keeping Australians Safe

The Government has pledged to strengthen security at Australian airports and enhance intelligence systems in response to a challenging and complex security environment. Smarter biosecurity systems are being rolled out to help protect Australia’s unique natural environment and to also safeguard borders.

• Strengthening airport security
• Managing biosecurity risks to protect our environment, exports and agricultural and tourism sectors
• Improving the national security architecture
• Continuing Operation Sovereign Borders to combat the threat of people smugglers

Ensuring that the Government lives within its means

For the first time in a decade, the Government is no longer borrowing to pay for everyday expenses, which is a result of sustainable budget management. Government borrowings will continue funding critical infrastructure and defence spending.

• Disciplined fiscal management and tax and welfare integrity
• Maintaining the trajectory to projected surplus in 2020"’21
• No longer borrowing for recurrent expenditure
• Limiting payments growth to 1.6 per cent
• Ensuring multinationals pay their fair share of tax
• Tackling the black economy

Last updated: 8th May 2018