Changes to the personal income tax system will make it more simple and transparent to use.
From July 1, the Government will serve tax cuts to low and middle-income individuals by increasing the tax-free threshold and modifying the initial two marginal tax rates over two phases.
The tax-free threshold will increase from $6000 to $18,200, with the maximum value of the low-income tax offset reduced from $1500 to $445.
The first marginal tax rate will be increased from 15 to 19 per cent and apply only to that part of taxable income which exceeds $18,200, but does not exceed $37,000.
The second marginal tax rate will increase from 30 to 32.5 per cent and apply to that part of taxable income which exceeds $37,000, but does not exceed $80,000.
Phase two of tax cuts will come into effect July 1, 2015.
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