03 May 2016

Australian Federal Budget 2016-17: Personal Tax

As part of the Budget, the Government has introduced only minimal changes to personal taxation. The key changes are to increase the 32.5% personal income tax threshold and the Medicare levy low-income threshold.

Personal income tax threshold

From 1 July 2016, the 32.5% personal income tax threshold will increase from $80,000 to $87,000. This will address bracket creep by reducing the marginal rate of tax on incomes between $80,000 and $87,000 from 37% to 32.5%.

As foreshadowed by the Treasurer prior to the Budget, the 2% budget deficit levy on incomes over $180,000 will not be extended beyond the end of the 2016-17 financial year.

Medicare levy low-income thresholds

The Government will increase the Medicare levy low-income threshold for singles, families, seniors and pensioners from the 2015-2016 income year. This seeks to take account of movements in the CPI. The Government has also announced that it will suspend indexation of the income thresholds for the Medicare Levy Surcharge and Private Health Insurance Rebate for a further three years.


For a full analysis of this year's Budget measures, please see Australian Federal Budget 2016-17.

Key contacts

Share on LinkedIn Share on Facebook Share on Twitter
    You might also be interested in

    Yesterday, the International Consortium of Investigative Journalists (ICIJ) released the “Pandora Papers”, 11.9 million leaked files (2.94 terabytes of data) that date back to the 1970s, detailing...

    05 October 2021

    Over the course of almost a decade, the ATO has been consistently focused on ensuring foreign income of Australian residents is taxed correctly in Australia.

    27 September 2021

    On 2 September 2021, the Federal Parliament passed legislation to require listed entities to provide a notice to their market operator containing certain details about payments they received under...

    03 September 2021

    CCIV Mark II deals with the major stumbling blocks which had held back the CCIV from successful implementation.

    27 August 2021

    This site uses cookies to enhance your experience and to help us improve the site. Please see our Privacy Policy for further information. If you continue without changing your settings, we will assume that you are happy to receive these cookies. You can change your cookie settings at any time.

    For more information on which cookies we use then please refer to our Cookie Policy.