Wayne Swan delivered his budget for 2010/11 on Tuesday 4 May in what is described as a “no frills” budget designed at bringing Australia out of deficit. What does the budget mean for you? Taxpayers will be able to claim $500 in work expenses without receipts from 1 July 2012 which will be increased to $1000 the following year. From 1 July 2011 you will receive a 50% discount on the interest you earn from money invested in a savings account. Previously any interest earned needed to be declared and taxed at the marginal rate. This will change so that you pay tax on half of the interest that you earned. Tax cuts will apply from 1 July 2010 with the tax free threshold increased to $16,000. The company tax rate will be 29% and 28% for small businesses.

The Government expect that Australia will return to surplus in 2012-13 which is 3 years earlier than expected. Health is a big winner with extra funding to train nurses, improve existing GP super clinics and provide 23 new ones. Extra revenue will be generated by increasing the tobacco excise and there will be savings resulting in changes to the Pharmaceutical Benefits Scheme. The childcare rebate will be reduced to $7,500 per child in a bid to provide revenue.