The Effects Of The Budget On Australians

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This year’s Australian budget reflects a stronger economy as Australia has shown a remarkable economic recovery following the pandemic. More Australians in the workforce and fewer on welfare have led to a significantly improved fiscal outlook.

The 2022 Budget Contains Some Notable Changes

The most significant is the increase in LMITO by $420 compared to the previous financial year. The government has also decided to cut the fuel excise by 22.1 cents a litre for the first six months. There is also a focus on digital technologies. Every small business that spends $100 on digital technologies can expect to receive a deduction of $120 while filing taxes for the year. Moreover, small businesses that spend at least $100 on training their employees will also receive a $120 tax deduction for every hundred spent.

The Key Budget Measures That Affect the Australian People

The key budget measures that affect the Australian people are those relating to families, households, and the working class:

  • A once-off payment for the cost of living of $250 to job seekers, pensioners, concession card holders, eligible self-funded retirees, veterans, and carers.
  • An increase in the Home Guarantee Scheme to 50,000 places every year.
  • An increase in the budget for National Housing Finance and Investment Corporation by $2 billion.

Pros and Cons of the budget

Pros

On the upside, the budget includes provisions for tax relief for low and middle-income earners, as well as increased funding for health and education. It also has plans to boost infrastructure spending and create new jobs.

Cons

On the downside, there are concerns that the budget does not do enough to address rising inequality and relies too heavily on growth in the property market. There is also concern that the proposed tax cuts will benefit high-income earners more.

Overall, the budget is likely to be positive for the economy, but these concerns must be addressed.

Cost of Living Impacts

As the cost of living rises, there is pressure on budgeting for essentials like food, housing, and transportation. This, in turn, diminishes the ability to save, invest, and use for discretionary spending. As a result, the government has decided to pay $250 as a once-off cost of living payment to carers, pensioners, concession card holders, job seekers, veterans, and self-funded retirees.

Trust Perth Tax People for all your financial year accounting needs. Our goal is to help you find avenues to save and bring you closer to financial freedom. Contact us at 08 9200 0582 to discuss your plans.

Nilesh Vasoya

Nilesh Vasoya

Nilesh Vasoya is a CPA and experienced business advisor with 15+ years’ experience in accounting and tax, and certifications from NTAA, ICAI (India). He is also a Registered Tax and ASIC Agent. Nilesh specialises in financial reports, cash flow, taxation advice, internal audit, account reconciliation, and advice for small businesses on maximising XERO, MYOB, and QUICKBOOKS. He is experienced in developing strategies for growth within small-medium scale companies.

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