The cost of living in Australia has been one of the biggest concerns heading into the announcement of the 2022-2023 Australian Federal Budget.
From surging fuel prices, an increasingly competitive property market, the cost of childcare and the rising cost of groceries, many Australians, particularly those with children, have been feeling the pinch.
Here’s what you can expect when it comes to tackling some of the major issues.
Cost of Living Tax Offset
Around 10 million Australians are expected to receive an extra $420 in their wallets in a bid to address the surging cost of living challenges.
Announced as part of the 2022-2023 Australian Federal Budget, the tax relief will be available from July 1 to Australians earning less than $126,000 a year.
Known as the “lamington”, the Low and Middle Income Tax Offset (LMITO) previously offered eligible recipients between $255 and $1080 at tax time. This will now increase from $675 and $1,500.
One-off Cost of Living Payment
Six million people will also receive a one-off, income tax-exempt payment of $250.
This payment will be paid automatically to all eligible pensioners, welfare recipients, veterans and eligible concession cardholders in April 2022.
Temporary Fuel Excise Relief
Meanwhile, fuel prices will be cut by 22c a litre by as early as the middle of next week.
While the relief will only be in place for six months, Treasurer Josh Frydenberg says this could save Australians as much as $700 in petrol costs.
On Tuesday, Treasurer Josh Frydenberg acknowledged the issue of rising petrol prices, telling ABC News, “These are costs that families are incurring and of course, it’s putting real pressure on their household budget.”
Making Homeownership More Attainable
The government also announced an expansion of its Home Guarantee Scheme to assist more Australians hoping to get into the property market.
Under the Home Guarantee Scheme, part of an eligible home buyer’s home loan will be guaranteed, enabling Australians to enter the property market sooner with a smaller deposit.
From July 1, 2022, its First Home Buyer Scheme will offer 35,000 guarantees — up from 10,000 — to first home buyers wanting to purchase a new or existing property with as little as a 5% deposit.
A regional arm of the scheme will provide 10,000 guarantees for first and existing home buyers and permanent residents wanting to purchase an existing home or construct a new property in regional areas.
5000 guarantees will also be available to single-parent families to allow single-income households to enter or re-enter the property market with as little as a 2% deposit.
The First Home Super Saver Scheme (FHSSS) will help Australians boost their savings for a first home by allowing them to build a deposit inside superannuation, giving them a tax cut. For most people, this will increase their savings for a deposit by at least 30 per cent compared with saving through a standard deposit account.
From 1 July 2022, the maximum amount of voluntary contributions that can be released under the FHSSS will be increased from $30,000 to $50,000 enabling first homeowners to achieve their dreams of homeownership sooner.
Not everybody is being catered to in the budget, though. as Ben Phillips, an Associate Professor at ANU pointed out, tweeting, “Poverty rates are highest for single parents (36%) and singles (23%). Why must we focus on ‘working families’ when concerning ourselves with cost of living pressures? Couples w kids lowest poverty rate at 8%.”
Read all of our budget coverage, here.
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