Low Earners will get more from Pay Packet
Tuesday’s federal budget will include additional assistance to around 6.5 million low-income families. This is a move that will encourage people to work while providing assistance with cost of living pressures.
The proportion of the low income tax offset or LITO that is delivered through workers’ week-to-week pay packets will be increased by the government from 50 to 70 per cent beginning July of this year.
The effect of this scheme is that low income earners will be taxed less during the year instead of getting back their money in the form of tax returns at the end of the year.
“This means a bit more money in people’s wage packet week-to-week to provide some modest help with cost-of-living pressures. We know this is a modest amount, but when the family budget is tight, every little bit helps,” said Treasurer Wayne Swan who is scheduled to reveal his fourth budget this coming Tuesday.
According to Mr. Swan, this move is also expected to increase work participation since it means more for the pay packet. Furthermore, this will make work more attractive.
“We know this is a modest amount, but when the family budget is tight, every little bit helps,” added Mr. Swan.
According to Jenny Macklin, Families Minister, this measure would make balancing the family’s weekly budget a little easier.
“Families will benefit by getting this assistance as their bills come in,” she added.
With the new scheme, families that earn $30,000 a year will have an extra $300 in their regular pay during the year. Meanwhile, the person’s total LITO entitlement will remain unchanged for any given tax year.
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Source : http://www.sbs.com.au/news/article/1534036/Low-earners-to-get-bit-more-in-pay-packet
