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Budget 2021: Another huge boost for Aussie tradies as they write off new utes and equipment 

Australian plumbers, carpenters, electricians and farmers have been given a significant boost in the Budget - allowing them to instantly write off the cost of new equipment.

Tradesmen with their own business can buy new utes and immediately claim them as tax deductions as part of the instant asset write-off scheme Treasurer Josh Frydenberg extended for a year in Tuesday's Budget.

Farmers meanwhile can buy new tractors and claim the cost back through the government's 'full expensing' scheme.

Any assets first used or installed by June 30, 2023 are eligible.  

Tradesmen and women can buy new utes and immediately claim them as tax deductions as part of the instant asset write-off scheme. Pictured is a construction worker in Sydney on May 11

Those companies with a turnover or income of less than $5billion can also offset taxed profit from as far back as 2018-19

The loss carry-back scheme allows companies with a turnover or income of less than $5billion to offset previously taxed profits as far back as the 2018-19 income year. 

The program is expected to cost the government $3.4billion in the long term.

Mr Frydenberg's extension of the instant-asset write off came as the government extended the low and middle income offsets for 10 million Australians. 

This will see 4.6 million Australians, earning between $48,000 and $90,000 receive $1,080 as another 1.8 million people earning $37,000 to $48,000 were given back $255. 

That scheme will set the federal government back $7.8billion, while another $1.9billion has been allocated to boosting vaccine supply to 170 million doses.

There will also be $879million provided over two years to support access to health care services and reduce the risk of community transmission of Covid-19. 

But for all the hype about generous $7.8billion tax cuts in the big-spending budget, most consumers won't see the extra dollars for more than a year.

Australians will have to wait for their tax return to be processed before they benefit from the rebates.  

The government's 'full expensing' scheme will allow eligible businesses to claim back profits

'Taxpayers can expect to see the benefit of the tax cut when they lodge their tax return for 2021-22, so 1 July 2022 at the earliest,' said Mark Chapman, Director of Tax Communications, H&R Block.

'So, in other words, taxpayers shouldn't expect to see the benefit any time soon.'

Meanwhile, the Stage 3 tax cuts are due to come into effect in 2024, introducing one flat tax rate on earnings between $45,000 and $200,000, benefiting Australia’s highest earners. 

Tuesday's Budget also includes a $9billion war chest to be used for yet-unannounced purposes - sparking speculation Prime Minister Scott Morrison will call an early election by the end of the year.

The fine print in the budget allows the government to set aside nearly $10billion for unspecified projects which have already been approved by the federal cabinet. 

Mr Morrison addresses a morning television interview in the Prime Minister's Courtyard at Parliament House on Wednesday. He has denied the government's big-budget spending announced on Tuesday has anything to do with being re-elected

INTERNATIONAL TRAVEL BAN TO CONTINUE UNTIL MIDDLE OF 2022 

Australians split from their families have received the devastating news that the international border will remain closed until at least mid-2022.

Treasurer Josh Frydenberg predicted in Tuesday night's Budget that Australians would be banned from leaving the country for all but essential reasons until the middle of next year.

Officials assume there will then be a 'gradual' return to normal travel after that point, but there are fears that airlines will be slow to come back to Australia, choking supply of flights and making tickets prohibitively expensive.

A passenger wearing a facemask arrive at Sydney International Airport on May 1.  The international border will remain closed until at least mid-2022, Australians have learned in Tuesday night's Budget

The lengthy delay in opening the international borders came despite Mr Frydenberg saying there was an 'assumption' that most of the Australian population would be vaccinated against Covid-19 by the end of 2021.  

Opposition leader Anthony Albanese said it was the Coalition government's fault the borders could not re-open sooner. 

'They are closing our border until mid-next year because they haven't got their act together on the two essential jobs they had this year to get right - the vaccination roll-out and quarantine,' Mr Albanese said.

But the Australian prime minister denied that allocation in the Budget has anything to do with being re-elected on Wednesday morning.

He fired up after Labor leader Anthony Albanese accused him of having 'no real plan beyond getting through the next election'. 

Mr Morrison defiantly hit back at Today show host Karl Stefanovic after he suggested the Liberal Party's big-spend budget was designed to win over voters.  

'You do care about being re-elected again,' Stefanovic said. 

Sydneysiders head to work ahead ahead of the Federal Budget on May 11. The low and middle income offset has been extended to 10 million Australians at a cost of $7.8billion

'The only opponent I have right now is the pandemic,' Morrison responded, adding he 'couldn't care less about the politics'. 

'That's the opponent I'm focused on. That is the fight Australia is in and as Australia's prime minister that is the fight I'm focused on.'

Mr Albanese also accused the government of leaving $3.8billion in the budget for a Liberal campaign 'slush fund' ahead of the expected federal election next year.

The prime minister hit back by saying the money left over from the budget would be used to fund the country's ongoing battle against Covid-19 - not to help him win the next election. 

'What we've done is kept things in reserve over the course of the balance of this year to keep fighting this pandemic,' Mr Morrison responded.  

HOW MUCH TAX RELIEF YOU WILL GET OVER THE FOUR YEARS FROM 2018-22 
Income Tax saving 
$40,000 $3,080
$60,000 $6,480 
$80,000 $6,480 
$90,000 $7,020 
$100,000 $6,720 
$120,000 $6,120 
$140,000 $5,400 
$160,000 $5,400 
$180,000 $5,400 
$200,000 $5,400 

'Australians like me, we're focused on ensuring we come through this. Nothing else matters.'   

Mr Frydenberg meanwhile said he was well aware how the spending would affect the national debt. 

'But to put it in perspective for you, the impact on the economy from Covid-19 has been more than 30 times what we saw during the GFC,' he said.  

'It has created a huge hole in the economy. That required an unprecedented economic response.' 

In his speech on Tuesday night, Mr Frydenberg was keen to focus the country's attention on two facts. 

The government is hoping to be rewarded politically for keeping Australia safe as the economy bounces back very strongly from the Covid lockdowns

Qantas pushes back all international flights until DECEMBER - after the government admitted the borders won't fully reopen until mid-2022 

 Qantas have announced they won't be resuming international flights until December at the earliest after previously suggesting they would be catering to travel bubbles in October. 

The national airline had hoped to help Australians travel abroad to government approved countries including New Zealand as soon as October, but that date has been pushed back. 

'We remain optimistic that additional bubbles will open once Australia's vaccine rollout is complete to countries who, by then, are in a similar position, but it's difficult to predict which ones at this stage,' a Qantas spokeswoman said Wednesday.

'We will keep reviewing these plans as we move towards December and circumstances evolve.' 

Qantas have announced they won't be resuming international flights until December at the earliest after previously suggesting they would be catering to travel bubbles in October

The economy is in incredible shape and, for the most part, our loved ones weren't murdered by a killer plague. 

'Australia's fate could have been so much worse,' Mr Frydenberg told Parliament on Tuesday night.  And he is right.

The catastrophe that has afflicted India, the United Kingdom, the US, Italy, Brazil – and most nations on Earth - has been averted in Australia.

Rather than hundreds of thousands of dead, Australia has lost 910 people to Covid-19 since the start of the pandemic.

In 2020, Treasury economists feared unemployment would hit 15 per cent, for the first time since the 1930s Great Depression, as two million Australians were bereft of work.

Gold Coast parents Matt Jack and Jahnah Heaps approved. They are pictured with children Koah, 6, and one-year-old Ziggy

Instead, the jobless rate in March stood at just 5.6 per cent, only marginally above the 5.2 per cent level just before the Covid lockdowns of March 2020.

A record 13.077million Australians now have a job compared to 778,100 who are unemployed.

Treasury is now expecting the jobless rate to fall to 4.75 per cent in 2022 and stay below 5 per cent out to 2025, which would be the longest run of historically-low unemployment since the 2006 to 2009 mining boom period leading up to the Global Financial Crisis.

Advertised job vacancies and consumer sentiment are at levels unseen in more than a decade and property prices in both the capital cities and regional areas are continuing to reach fresh record highs every month.

Working parents will get a further boost as the budget slashes childcare fees for second and subsequent children and scraps the maximum subsidy amount, which will save 250,000 families an average of $2,200 a year.

The Australian Securities Exchange on Monday also briefly surpassed the record-high closes level of February 2020, before the pandemic. 

Working parents will get a further boost as the budget slashes childcare fees for second and subsequent children and scraps the maximum subsidy amount, which will save 250,000 families an average of $2,200 a year. 

Burleigh Heads parents Matt Jack and Jahnah Heaps approved. 

'We are both pleased with the childcare cost reduction,' they told Daily Mail Australia.

'Any subsidies will be a huge help, as long as it helps all families in all income brackets.' 

Foreigners have been banned from entering Australia since March 2020 and the Budget projected that would continue until at least the middle of next year, as a result of a slow vaccine rollout. Pictured are domestic passengers in Melbourne

With low-paid women in mind, from July 2022 the $450 monthly threshold before workers receive superannuation from their employer.

'This will improve economic security in retirement for around 200,000 women,' Mr Frydenberg said.

'Our plan will also make it easier for Australians to prepare for retirement and to be more secure once in retirement.'

Colonial First State, a retail super fund, calculated that under super existing rules, a 30-year-old woman with $50,000 in retirement savings would only have $57,651 by the time they turned 40.

What the Budget means for you:

If you earn less than $450 a month 

The requirement that workers have to earn $450 a month with a single employer before they get super payments will be scrapped.

This policy will mostly benefit women, with twice as many women than men earning less than $450 a month.

If you're unemployed 

Almost two million unemployed Australians will enjoy an extra $50 per fortnight as part of a $9.5billion boost to welfare payments revealed in the 2021 Federal Budget.

Treasurer Josh Frydenberg also announced the income-free area will be increased to $150 per fortnight for JobSeeker Payment and Youth Allowance.

This means recipients can have income up to $150 per fortnight before their payments will be decreased.

However to access the bonus, job seekers will be forced to apply for 20 jobs per month, up from the current 15. The new requirements will come into effect from July.

Job seekers will be forced in online employment services to complete their career profile in the JobActive system.

Mr Frydenberg said $9.5billion would be set aside over the next five years to support Australians eligible for working-age payments, which includes JobSeeker.

About 1.9 million Australians who are on working-age payments will benefit from the $50 fortnightly cash boost.

It will apply to those on the Youth Allowance, Austudy, Parenting Payment, ABSTUDY Living Allowance, Widow Allowance, Partner Allowance, Special Benefit and Farm Household Allowance.

If you're a small business owner

Pictured: Small business owner Lincoln Testa in Broadbeach on the Gold Coast. He said: 'As for the budget, in this country there is no incentive to acquire wealth. We need some tax relief there so we can spend money, and each time we spend money it gets taxed. Work out a way to spend a dollar in Australia and keep turning it over in Australia.'

In a huge win for businesses, the government will extend for another year the instant asset write-off which allows companies to write-off the full value of any asset they buy.

It means tradies can buy new utes and farmers can buy new tractors and deduct the full cost from their profits.

The loss carry-back scheme will also be extended until June 2023, allowing companies to offset previously taxed profits as far back as the 2018-19 income year.

Mr Frydenberg will also streamline Australia's insolvency laws further for small and large businesses.

The government will increase the threshold at which creditors can issue a statutory demand on a company from $2,000 to $4,000.

This will help prevent distressed but viable companies from being pushed into liquidation over small debts.

The government will consult on how trusts are treated under insolvency laws, and whether the so-called insolvent trading safe-harbour provisions that were introduced in 2017 remain fit for purpose.

It is also considering the introduction of a moratorium on creditor enforcement while insolvency schemes are being negotiated.

This comes on top of the changes that came into force from January 1 that simplified the restructuring and liquidation process for small firms, providing directors greater control to either restructure or wind down their operations.

The government will allow small businesses to apply to the Administrative Appeals Tribunal (AAT) to pause or modify Australian Taxation Office debt recovery actions where the debt is being disputed in the AAT.

Under existing rules, small businesses are only able to pause or modify tax office debt recovery actions through the court system, which can be costly and time consuming.

Applying to the AAT instead of the courts will save small businesses at least several thousands of dollars in court and legal fees and as much as 60 days of waiting for a decision.

If you're a school leaver

More free TAFE courses will be provided. Pictured: A tradie in Sydney

The JobTrainer program providing free short courses for thousands of young Aussies will be extended to provide another 163,000 training places.

The policy, announced last year, saw the federal government provide $500million for free vocational courses, with the funding matched by state and territory governments.

The scheme means that a certificate in business administration or a certificate in customer engagement which normally cost $1,320 will be free.

To qualify, you must be aged 17 to 24, unemployed or expect to become unemployed.

Mr Frydenberg revealed the policy has subsidised tuition fees for 100,000 places since September.

The courses are designed to prepare workers for jobs in expanding sectors including healthcare, social care, transport, postal services and warehousing, manufacturing and retail.

The government has also removed the 100,000-person cap on the Boosting Apprenticeship Commencements scheme after the places filled up in just five months.

The policy was due to stop on September 30, 2021 but any apprentice hired before then will have half their wages paid by the government for a whole year from the day they start.

Mr Morrison expects the extension will help another 70,000 apprentices get jobs at a cost of $1.2billion to taxpayers.

If you want to travel 

Australia's borders to the outside world will remain virtually shut through to mid-2022 according to federal budget forecasts released on Tuesday evening

Australians won't be travelling overseas again until at least the middle of 2022 the government predicts - in a major shift on its previous claim that the border could reopen by October this year.

Government forecasts released in federal budget documents on Tuesday say that inbound and outbound international travel into Australia 'will remain low through to mid-2022.'

But officials assume there will then be a 'gradual' return to normal travel after that point.

'Safe travel zones' will be established, as Australia has done with the travel bubble.

Last year the Government predicted international borders would be open in October 2021 after the whole adult population has been offered a vaccination.

However, this timeline has now been pushed back as Australia's vaccination rollout falls behind due to supply shortages and vaccine hesitancy.

If you're a working parent

The government will spend $1.7billion on changes to the childcare system.

The cost of childcare for a second and subsequent child will be subsidised by up to 95 per cent, up from the current 85 per cent maximum.

About 250,000 families are expected to save $2,260 a year on childcare fees.

Families who earn a combined $110,000 and have two kids in childcare four days a week will save $95.39 a week. 

If you drink and smoke  

Australia's smokers and drinkers have been spared a tax hike on Budget night for the first time in almost a decade despite a string of forecast deficits.

Josh Frydenberg is the first Treasurer since 2012 to have avoided raising excise duty - colloquially known as sin taxes - for some easy revenue.

Since 2013, both sides of politics had annually increased excise duty on tobacco and alcohol.

If you earn less than $450 a month 

The government will extend the low and middle-income tax offset (LMITO), which is worth up to $1,080 and benefits people with a taxable income up to $126,000. Pictured: A worker in Sydney

The requirement that workers have to earn $450 a month with a single employer before they get super payments will be scrapped.

This policy will mostly benefit women, with twice as many women than men earning less than $450 a month.

Colonial First State, a retail super fund, calculated that under super existing rules, a 30-year-old woman with $50,000 in retirement savings would only have $57,651 by the time they turned 40.

If you're a working parent 

The government will spend $1.7billion on changes to the childcare system.

The cost of childcare for a second and subsequent child will be subsidised by up to 95 per cent, up from the current 85 per cent maximum.  

About 250,000 families are expected to save $2,260 a year on childcare fees. 

Families who earn a combined $110,000 and have two kids in childcare four days a week will save $95.39 a week.

If you earn an average wage 

Mr Frydenberg will extend the low and middle-income tax offset (LMITO), which is worth up to $1,080 and benefits people with a taxable income up to $126,000.

The bonus, which was available for the 2018–19, 2019–20 and 2020–21 income years, had been scheduled to run out in June.

However Mr Frydenberg will extend it for another year at a cost of about $7billion.

If you want to buy a house

Single parents who have been priced out Australia's soaring property market are set to be the big winners from the budget, with a new scheme allowing them to purchase a home with a two per cent deposit. 

Under the new plan starting in July, a single parent can buy a $500,000 home with deposit of just $10,000.

The scheme will help 10,000 single parents buy a home over the next four years - but competition will be high because 125,000 people will be eligible, with 80 per cent of them women.

The entry of that many people into the housing market is also set to push house prices even higher. 

If you work in kids' TV  

The foundation which helped fund Bluey the cartoon dog and hit 90s show Round The Twist was the recipient of $11million in Federal Budget 2022

Bluey - the Brisbane-based cartoon dog beloved by children and parents alike - could benefit from an $11million handout announced by Arts Minister Paul Fletcher.

The government has announced it will supply those funds to the Australian Children's Television Foundation.

The foundation played a 'pivotal' role in getting the popular kids TV show off the ground.

It was also responsible for bringing about classic programs such as '90s show Round The Twist and Dance Academy.

If you're a woman 

The budget will include a $353.9 million health package for women spread over four years.

The package includes funding for cervical and breast cancer, endometriosis and reproductive health.

Health and Aged Care Minister Greg Hunt said the government was committed to improving health services around Australia for all women and girls, including Aboriginal and Torres Strait Islander people.

Key measures include $100.4million for improvements to cervical and breast cancer screening programs and $95.9 million for new tests on the MBS for pre-implantation genetic testing (PGT) of embryos for specific genetic or chromosomal abnormalities prior to implantation and pregnancy.

If you're a tradie

The budget will contain a series of building projects to stimulate jobs and build up the nation's infrastructure.  

Major road upgrades, a new freight terminal and the rebuild of a key regional airport will form part of a huge infrastructure program announced in Tuesday's federal budget.

Treasurer Josh Frydenberg will announce projects worth $110 billion to generate thousands of jobs over the next ten years as the nation recovers from the Covid-19 pandemic.

Some key projects include upgrades to the Great Western Highway in NSW and Queensland's Bruce Highway, as well as a new freight train terminal in Melbourne.

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