NATSEM Federal Budget Analysis: Mid to high income groups may benefit more than people might think

first_imgNATSEM Federal Budget Analysis: Mid to high income groups may benefit more than people might think The National Centre for Social and Economic Modelling (NATSEM) at the University of Canberra has found that mid to high income people are one of the winners from this year’s Federal Budget.NATSEM’s Budget Analysis has found that the extension of the low and middle income tax offset (LMITO) actually benefits higher income families as low-income families often do not earn enough to fully benefit from the tax offset.The report also suggests that the childcare subsidy increase will also benefit mid and high income families given increased childcare use as well as the activity test requirement of the childcare subsidy.“To claim the full benefit from the increased childcare subsidy, families will need to have an income of at least $129,000 a year, as the lower-income families already claim benefit closer to the capped ratio,” said Professor Jinjing Li, who runs NATSEM’s tax modelling.If the childcare price rises due to the increased demand, families with a single child or lower income may even lose out. The removal of the cap of childcare subsidy also favours high-income families.Assuming families use childcare on days when parents are at work, the budget’s impact is likely the largest for the families in the fourth quintile and the lowest for the families in the bottom quintile.“Overall, the impact of the proposed tax transfer policy change in this year’s budget is small compared with the likely impact of the 2024/25 tax cut, which will substantially benefit the higher income groups,” said Professor Li.NATSEM’s report also analyses the impact of the home guarantee scheme where the government lowers the down payment required for the eligible households.The finding from the analysis suggests that there could be up to 6 per cent of potential renters interested in the scheme based on their current savings. However, the percentage is lower at 4.3 per cent for single parents despite a more generous support. Critically for most of them, the potential mortgage repayment would be higher than their current rent.The full analysis can be found here. /Public Release. This material comes from the originating organization and may be of a point-in-time nature, edited for clarity, style and length. View in full here. Why?Well, unlike many news organisations, we have no sponsors, no corporate or ideological interests. We don’t put up a paywall – we believe in free access to information of public interest. Media ownership in Australia is one of the most concentrated in the world (Learn more). Since the trend of consolidation is and has historically been upward, fewer and fewer individuals or organizations control increasing shares of the mass media in our country. According to independent assessment, about 98% of the media sector is held by three conglomerates. This tendency is not only totally unacceptable, but also to a degree frightening). Learn more hereWe endeavour to provide the community with real-time access to true unfiltered news firsthand from primary sources. It is a bumpy road with all sorties of difficulties. We can only achieve this goal together. Our website is open to any citizen journalists and organizations who want to contribute, publish high-quality insights or send media releases to improve public access to impartial information. You and we have the right to know, learn, read, hear what and how we deem appropriate.Your support is greatly appreciated. All donations are kept completely private and confidential.Thank you in advance!Tags:Australia, Canberra, childcare, Federal, federal budget, Government, Impact, mortgage, Professor, rent, tax, university, University of Canberralast_img read more