Budget 2018: Your cheat sheet to understanding where the money's going this year

Updated

This is Scott Morrison's third budget and put simply, it's a pre-election document designed to make sure he gets another one.

That means there are a few gifts headed your way thanks to an improving economy along with some new revenue measures.

Here's a quick guide to what's been announced:

You're getting a tax cut

This will be done in three ways over seven years.

The first is simple but be patient — you won't get it until your tax return next year. If you're a low or middle-income earner, you can expect up to $530 a year — or just over $10 a week.

The second is a tweak to tax brackets. Right now, you pay more when your salary goes north of $87,000. That's going to change. You won't start paying more until you earn $90,000.

The last is more drastic — a flattening of the tax system. By 2024, everyone earning between $41,000 and $200,000 will pay 32.5 per cent tax. That means a big tax cut for those earning more than $90,000 who would have paid 37 per cent, but it's a long way down the track.

Plenty can happen in one year of politics — let alone seven years — so there's no guarantee Mr Morrison's sweeping vision will become a reality.

But what about that surplus?

If all goes to plan, the budget will return to surplus a year earlier than planned in 2019-20. But it will only be $2.2 billion in the black — just 0.1 per cent of GDP — so a small change in fortunes and it's gone.

The surplus for the year after will be bigger than expected — $16.6 billion — but again that's all subject to Treasury forecasting.

More on how the Government's going to pay for all this a bit later.

Superannuation will give you less headaches

Do you have superannuation payments sitting in multiple accounts? If you do, the Australian Tax Office will be given powers to find it for you and send it to your active account.

They'll also ban exit fees. That means superannuation providers won't be able charge you when you want to move to a better provider.

If you're young or not earning a lot of money, superannuation companies won't be able to force you to pay life insurance policies if you don't want them.

Aged care is a big focus of this budget

The Government wants more older Australians to get care at home. About 14,000 more people will get home care packages at a cost of $1.6 billion over four years.

A new commissioner responsible for safety and quality care will get a $253 million kickstart over four years. Mental health services in aged care homes will also be bolstered.

More than $30 million will go towards improving palliative care, provided state governments also chip in a similar amount of money.

Prepare for roadworks

As expected, the Government is spending big on roads and rail. There's $24.5 billion for new projects to ease congestion. Most money is going to Victoria including the biggest item; $5 billion for a rail line to Melbourne airport.

But there is a political fight ahead — for many of the bigger projects, the Commonwealth wants the states to pitch in half the money. If they don't, those projects won't go ahead without a battle.

The Coalition wants more doctors in rural areas

There's money for five new medical schools in the Murray-Darling region so students can complete the majority of their training in the regions.

There will also be a new junior doctor training program and money for another 100 vocational training places.

The Royal Flying Doctor Service will pick up $84 million in funding and for the first time, it will deliver dental and mental health services.

The number of visas set aside for international doctors to help ease a shortage has been revised down, thanks to increasing graduate numbers.

Don't worry … there're no nasties to pay for those tax cuts

So how are they paying for it?

The Government is going after illicit tobacco sales in a bid to reclaim $3.6 billion over four years.

The so-called Black Economy Taskforce will target sectors known to avoid paying tax, which should reclaim about $5.3 billion over four years.

It'll also crack down on money laundering, so payments of more than $10,000 will now become illegal.

Topics: federal-parliament, federal-government, government-and-politics, budget, australia

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