Government signals extension of $1,080 low-middle-income tax offset

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on November 15, 2021 Fact Checked
Government signals extension of $1,080 low-middle-income tax offset

Prime Minister Scott Morrison has floated the possibility of tax relief for millions of Australians could be extended past its initial 30 June 2022 expiry.

Aiming to resuscitate the Australian economy following nearly two years of lockdowns, the Prime Minister will aim to make a call at an 'appropriate time' as to whether tax cuts brought forward two years will be extended. 

Low and middle income earners welcomed tax cuts for 2020-2021 tax period, labelled the Low and Middle Income Earner Tax Offsets (LMITO).

The package due to expire June 30 2022 placed more than $7 billion back in the pockets of Australians throughout 2021. 

Speaking with News Corp papers, the Prime Minister said cutting taxes had always been the government's approach. 

"We've got a very strong record of delivering tax cuts," Prime Minister Scott Morrison said. 

"If you really want people and business to get on and do things, you can't keep more of what they earn, it has to go back the other way."

However, the news was met with cynicism from some.

Director of Tax Communications at H&R Block, Mark Chapman, said much of the media coverage around this proposal has focused on Scott Morrison’s attempt to claim that he is delivering a tax cut by maintaining the low-and middle-income tax offset.

"Scott Morrison is simply proposing to defer a tax rise, one that he and his government have already legislated," Mr Chapman said. 

"Mr Morrison has not made the offset a permanent feature of the tax system but has merely talked about 'extending' it.

"This raises the possibility that this is all spin, designed to see the government through the general election, at which point they will return to the already legislated abolition of the offset in 2023 or later."


Image by Emil Kalibradov via Unsplash.

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Jacob Cocciolone joined the Savings team in 2021 as a Finance Journalist. Driven by a passion for keeping Australians up to date with the latest financial news and trends, his areas of interest include financial technology, investing, property and motoring.

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