Highlights
- New policies aim at relieving long term financial pressures
- Immediate aids of JobKeeper and JobSeeker payments to be axed
- New homebuyers, Welfare recipients and Parents set for benefits
2020 is a year we largely want to put behind us. The calamities of bushfires and the coronavirus pandemic hit us like mountain boulders and the year was spent either dodging them or nursing their bruises.
Naturally, our finances suffered. The economy was pushed into recession. The Australia Government came up with certain new policies and tax cuts to aid the population recover from the strain of this financial pressure.
Some policies such as JobKeeper were a temporary relief that 2021 will see axed, while others like the tax cuts were long term to let taxpayers have a little extra spendable income in their hand.
Here is a list of upcoming year’s highlights for you.
The Job policy trio
The urgent economic injections of JobKeeper, JobSeeker and JobMaker plans helped Australian taxpayers tide over the worst of the pandemic, when employers suddenly found themselves under heavy losses, employees were out of jobs and the job market in general, plummeted. While the financial handouts of JobKeeper and JobSeeker will now witness a gradual phase out, the JobMaker Plan will make the Hiring Credit claims available for employers from February 2021.
Phasing out JobKeeper
The economic stimulus, JobKeeper is a program to support employers to keep their employees on roll and help employees overcome the loss of work. The government now believes that the policy has served its purpose, and hence shall be gradually phased out by March 28, 2021.
The first payment cuts shall appear from January 4, 2021, with full-time workers receiving $1000, in place of the current $1200 per fortnight, and part-timers receiving $650 instead of the current $750.
JobSeeker payment cut
As with the JobKeeper plan, the JobSeeker payments were made available to those who were suddenly unemployed because of the pandemic. JobSeeker Payment recipients receive the Coronavirus Supplement on top of their base rate of payment. It was paid at an initial rate of $550 per fortnight until September 24; thereafter at rate of $250 per fortnight until December 31. From January 1 to March 31, it will be pad at a further lowered rate of $150 per fortnight.
JobMaker Plan
Introduced in the 2020-21 budget as an incentive to hire young people, the JobMaker Plan offers Hiring Credit to employers at the rate of $200/week for each new hiring between the age of 16-30 and $100 for each new hiring between the age of 30-35. The Credit is administered by the Australian Tax Office and is available for quarterly claims from February 2021 onwards.
Lump Sum Tax Cuts
An extra boost to the wallet money of Aussies, lump sum tax cuts provide an early, half of the tax cut in the paycheques of the employees, while the other half shall be returned to the taxpayers mid-year, when they file their return. The policy has increased the cash-in-hand for the Aussie population.
Economic Support Payment for Pensioners
Welfare recipients, including pensioners and disability carers are set to receive two $250 cash payments, the first in December 2020 and the other in March 2021. Aged and disability pensioners, veterans, people on carer payments and family tax benefit recipients are eligible for these payments. In addition, Commonwealth Seniors Health Card holders and pensioner concession cardholders can also claim this payment.
Changes in Paid Parental Leaves
As per the current law, parents must have worked 10 of the previous 13 months before they gave birth or adopted a child to be eligible for the payment.
The government has now relaxed the rules a little to help parents who would have suffered financial and employment setbacks due to the pandemic.
This changed to allow parents who give birth or adopt a child between March 22, 2020 and March 31, 2021 to still qualify for the payment if they have worked in 10 of the last 20 months.
Changes in Health Insurance
In an attempt to make private health insurance more affordable, the government has increased the age of a dependent to 31 from current 24. The change will be affected from April 1, 2021.
Stamp duty reductions in NSW
The new proposal by NSW government could phase out stamp duty in NSW completely by mid-2021.
The proposed change, announced in the NSW budget, would mean stamp duty would be replaced with an annual land tax on new property transactions. Homebuyers would have a choice between paying a one-off stamp duty bill or an annual property tax. First-time buyers would get an extra incentive with a grant worth up to $25,000 under the proposed overhaul instead of an exemption from stamp duty.
Road Rules to become stricter
In a bid to make the roads safer for Australian drivers, the decade long National Road safety strategy, effective from 2021 to 2030 is expected to be launched early in 2021. It aims at strengthening penalties for rash and reckless driving.
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