Tax Laws Amendment (Personal Income Tax Reduction) Act 2008

Administered by Department of the Treasury

Legislation au C2008A00029 In force Act

Legislation content

 

 

 

 

 

 

Tax Laws Amendment (Personal Income Tax Reduction) Act 2008

 

No. 29, 2008

 

 

 

 

 

An Act to amend the law relating to taxation, and for related purposes

 

 

Contents

1 Short title

2 Commencement

3 Schedule(s)

Schedule 1—Amendments

Part 1—Amendments having effect from the 2008‑09 year of income

Income Tax Assessment Act 1936

Income Tax Rates Act 1986

Medicare Levy Act 1986

Part 2—Amendments having effect from the 2009‑10 year of income

Income Tax Assessment Act 1936

Income Tax Rates Act 1986

Medicare Levy Act 1986

Part 3—Amendments having effect from the 2010‑11 year of income

Income Tax Assessment Act 1936

Income Tax Rates Act 1986

Medicare Levy Act 1986

 

 

 

Tax Laws Amendment (Personal Income Tax Reduction) Act 2008

No. 29, 2008

 

 

 

An Act to amend the law relating to taxation, and for related purposes

[Assented to 23 June 2008]

The Parliament of Australia enacts:

1  Short title

  This Act may be cited as the Tax Laws Amendment (Personal Income Tax Reduction) Act 2008.

2  Commencement

 (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent.

23 June 2008

2.  Schedule 1, Part 1

1 July 2008.

1 July 2008

3.  Schedule 1, Part 2

1 July 2009.

1 July 2009

4.  Schedule 1, Part 3

1 July 2010.

1 July 2010

Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

 (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

3  Schedule(s)

  Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


Schedule 1—Amendments

Part 1—Amendments having effect from the 2008‑09 year of income

Income Tax Assessment Act 1936

1  Subsection 159N(1)

Omit “$48,750”, substitute “$60,000”.

2  Subsection 159N(2)

Omit “$750”, substitute “$1,200”.

Income Tax Rates Act 1986

3  Clause 1 of Part I of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

exceeds $6,000 but does not exceed $34,000

15%

2

exceeds $34,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

40%

4

exceeds $180,000

45%

4  Clause 1 of Part II of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for non‑resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

does not exceed $34,000

29%

2

exceeds $34,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

40%

4

exceeds $180,000

45%

5  Subparagraph 2(b)(ii) of Division 2 of Part I of Schedule 8

Omit “$30,000” (wherever occurring), substitute “$34,000”.

6  Paragraph 2(b) of Part I of Schedule 10

Omit “$30,000” (wherever occurring), substitute “$34,000”.

Medicare Levy Act 1986

7  Subsection 3(1) (paragraph (a) of the definition of phase‑in limit)

Omit “$30,431”, substitute “$33,961”.

8  Subsection 3(1) (paragraph (a) of the definition of threshold amount)

Omit “$25,867”, substitute “$28,867”.

9  Subsection 8(7)

Omit “$37,950”, substitute “$42,000”.

10  Application

The amendments made by this Part apply to assessments for the 2008‑09 year of income.


Part 2—Amendments having effect from the 2009‑10 year of income

Income Tax Assessment Act 1936

11  Subsection 159N(1)

Omit “$60,000”, substitute “$63,750”.

12  Subsection 159N(2)

Omit “$1,200”, substitute “$1,350”.

Income Tax Rates Act 1986

13  Clause 1 of Part I of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

exceeds $6,000 but does not exceed $35,000

15%

2

exceeds $35,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

38%

4

exceeds $180,000

45%

14  Clause 1 of Part II of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for non‑resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

does not exceed $35,000

29%

2

exceeds $35,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

38%

4

exceeds $180,000

45%

15  Subparagraph 2(b)(ii) of Division 2 of Part I of Schedule 8

Omit “$34,000” (wherever occurring), substitute “$35,000”.

16  Paragraph 2(b) of Part I of Schedule 10

Omit “$34,000” (wherever occurring), substitute “$35,000”.

Medicare Levy Act 1986

17  Subsection 3(1) (paragraph (a) of the definition of phase‑in limit)

Omit “$33,961”, substitute “$35,137”.

18  Subsection 3(1) (paragraph (a) of the definition of threshold amount)

Omit “$28,867”, substitute “$29,867”.

19  Subsection 8(7)

Omit “$42,000”, substitute “$43,500”.

20  Application

The amendments made by this Part apply to assessments for the 2009‑10 year of income.


Part 3—Amendments having effect from the 2010‑11 year of income

Income Tax Assessment Act 1936

21  Subsection 159N(1)

Omit “$63,750”, substitute “$67,500”.

22  Subsection 159N(2)

Omit “$1,350”, substitute “$1,500”.

Income Tax Rates Act 1986

23  Clause 1 of Part I of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

exceeds $6,000 but does not exceed $37,000

15%

2

exceeds $37,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

37%

4

exceeds $180,000

45%

24  Clause 1 of Part II of Schedule 7 (table)

Repeal the table, substitute:

 

Tax rates for non‑resident taxpayers

Item

For the part of the ordinary taxable income of the taxpayer that:

The rate is:

1

does not exceed $37,000

29%

2

exceeds $37,000 but does not exceed $80,000

30%

3

exceeds $80,000 but does not exceed $180,000

37%

4

exceeds $180,000

45%

25  Subparagraph 2(b)(ii) of Division 2 of Part I of Schedule 8

Omit “$35,000” (wherever occurring), substitute “$37,000”.

26  Paragraph 2(b) of Part I of Schedule 10

Omit “$35,000” (wherever occurring), substitute “$37,000”.

Medicare Levy Act 1986

27  Subsection 3(1) (paragraph (a) of the definition of phase‑in limit)

Omit “$35,137”, substitute “$36,100”.

28  Subsection 3(1) (paragraph (a) of the definition of threshold amount)

Omit “$29,867”, substitute “$30,685”.

29  Subsection 8(7)

Omit “$43,500”, substitute “$44,500”.

30  Application

The amendments made by this Part apply to assessments for the 2010‑11 year of income and later years of income.

 

 

 

 

[Minister’s second reading speech made in—

House of Representatives on 14 February 2008

Senate on 13 March 2008]

(15/08)

 

Overview

The Tax Laws Amendment (Personal Income Tax Reduction) Act 2008, enacted on 23 June 2008 by the Parliament of Australia, was introduced to amend existing tax laws to reduce personal income tax rates over a three-year period, starting from the 2008-09 income year. This Act aims to provide tax relief to taxpayers by gradually reducing the income tax rates for both resident and non-resident taxpayers, as well as adjusting the thresholds for the Medicare Levy. The amendments are structured to take effect progressively over three financial years, with each subsequent year seeing further reductions in tax rates and adjustments to related thresholds. The policy objective is to alleviate the tax burden on taxpayers and to provide a measure of economic stimulus.

Scope and Application

The Tax Laws Amendment (Personal Income Tax Reduction) Act 2008 applies to individuals and entities that are subject to the income tax laws in Australia. The Act amends the Income Tax Assessment Act 1936, Income Tax Rates Act 1986, and Medicare Levy Act 1986 to reduce personal income tax rates progressively over three financial years starting from the 2008-09 year of income. The amendments progressively increase the tax-free threshold and lower the tax rates for different income brackets for both resident and non-resident taxpayers. The Act's amendments are applied to income assessments for the specified years, and no specific exclusions or exemptions are noted within the Act itself. The Act does not extend or restrict its application through subordinate instruments, as the amendments are detailed directly within the Act. The Act applies across the Commonwealth of Australia, impacting all taxpayers who fall under the specified Acts.

Key Provisions

The Tax Laws Amendment (Personal Income Tax Reduction) Act 2008 (the Act) primarily amends the Income Tax Assessment Act 1936, the Income Tax Rates Act 1986, and the Medicare Levy Act 1986 to introduce phased reductions in personal income tax rates. Section 1 of the Act indicates that the Act may be cited as the Tax Laws Amendment (Personal Income Tax Reduction) Act 2008, while Section 2 provides details on the commencement of the Act's provisions. Specifically, Sections 1 to 3, and any other provisions not covered by the table in Section 2, commence on 23 June 2008, the day the Act receives Royal Assent. The amendments in Schedule 1, Part 1, which apply to the 2008–09 year of income, commence on 1 July 2008. Amendments in Schedule 1, Part 2, applicable to the 2009–10 year of income, commence on 1 July 2009. Finally, amendments in Schedule 1, Part 3, applicable to the 2010–11 year of income and later years, commence on 1 July 2010. Section 3 specifies that the Acts mentioned in the Schedule are amended or repealed as outlined in the respective Schedule items. The Act imposes obligations on taxpayers and entities subject to the amended tax laws. For instance, taxpayers must ensure their income tax calculations comply with the new rates and thresholds specified in the amended Acts. Specifically, the amendments adjust income thresholds and tax rates for both resident and non-resident taxpayers over three financial years. For example, under the Income Tax Rates Act 1986, the income thresholds for tax brackets are increased, meaning more income falls under lower tax rates. Additionally, the Medicare Levy Act 1986 revises the phase-in limits and threshold amounts for the Medicare levy, affecting the income levels at which individuals become liable to pay the levy. Breach of the obligations set out in the Act can result in civil and criminal consequences. The Act itself does not explicitly outline specific offences or penalties for non-compliance with the amended tax laws; however, such consequences are typically governed by the primary Acts being amended. Under the Income Tax Assessment Act 1936, penalties for non-compliance can include fines and interest on unpaid tax. For serious non-compliance, such as fraud or deliberate tax evasion, criminal penalties may apply, including imprisonment. The severity of these penalties can depend on the nature and extent of the non-compliance, with maximum penalties varying based on the specific provisions breached.

Legal classification tags

Area of Law
Taxation Law
Instrument
Act
Concepts
Commencement Provisions
Repeal & Amendment
Tax rates for resident taxpayers
Tax rates for non-resident taxpayers

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.