MACKAY, Qld—Australians will receive some respite from the rising cost of living when the Rudd Government's tax cuts come into effect from tomorrow, Treasurer Wayne Swan says.
Labor's first budget in 12 years has delivered $46.7 billion in personal tax cuts, aimed primarily at lower income earners.
From the start of the new financial year tomorrow people earning $40,000 a year will receive an additional $20.19 per week in tax cuts, or about $1,050 a year.
For those on $80,000 a year the tax cut will be $21.15 or $1,100 a year.
Mr Swan said the cuts would help offset rising fuel and grocery prices.
"This global oil shock has resulted in, on average, an increase of about 30 cents per litre of petrol since the beginning of the year - that certainly has an impact," he told reporters in the north Queensland city of Mackay where federal cabinet met today.
"Given what's occurred with the increases in the cost of living, the tax cuts are absolutely essential to provide some relief to working families who are doing it tough."
Mr Swan said when combined with an increase in the Child Care Tax Rebate and the Education Tax Refund included in his budget the average working family would be $54 a week better off.
"The important thing about these tax cuts which commence from the 1st of July is that they tip the scales back towards working families."
He said despite fears the tax cuts would add to inflationary pressures the Government had deemed them necessary in the current economic climate.
"Earlier this year when we were preparing the budget there was a lot of advice to the Government (not to) proceed with the tax cuts, well we've proceeded with the tax cuts because they have been earned by the Australian people."
The utilities allowance for pensioners and carers will also increase to $500 a year from tomorrow.
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