In case you didn't turn on your TV last night, the 2017 Federal Budget was delivered by Treasurer Scott Morrison in Parliament and as always, there were some winners, some losers and even some very controversial new policies (drug tests for Dole receipts?!) introduced. Let's cut through the financial jargon to get down to how it will affect you and your family.
Back in 2013 the Labor government "temporarily" introduced the Medicare freeze as a way to save a few (million) pennies on healthcare – it was unpopular, it cost us more money each time we visited the doctor and so the Coalition always promised to lift it should they come into power. Well, they have finally been true to their word. Come July 1, GPs will be strongly encouraged to bulk bill (and will get kickback if they do) and prescribe generic - aka cheaper - medications.
The cost of some other medicines listed on the Pharmaceutical Benefits Scheme (PBS) - such as contraceptive pills and epipens - may also fall as the Government has struck a deal where the price for these medicines are progressively cut every five years. As part of the deal, the big pharmaceutical companies will pick up the tab so us consumers enjoy the savings. Nice one. Once the medication is no longer covered by a patent (about 10 years), there will also be a further 0.25 per cent price reduction.
Things will only get better too - kind of. By July 2018, the Medicare rebate will rise by about 50 per cent per visit to the doctor, and by 2019 rebates for specialist visits will be in line with the cost of inflation, for the first time in five long years. That said, at this same time you'll pay more for the Medicare Levy. It's set to rise 0.5 per cent a year which is about $400 for an average income earner. Feel that sting.
If you have kids who meet the Child Dental Scheme eligibility criteria you'll be pleased to know the $700 bi-annual rebate cap will rise to $1000 on July 1. That's an extra $300 that can be spent on fillings, X-rays and cleans every two years.
Aside from the major Centrelink changes made to family benefits in order to make the system more sustainable this year, there's two other budget changes afoot which may affect how much money your family receives.Firstly, you don't need to worry now but from July 2018 you will lose 30 cents, instead of 20 cents, for every dollar your family earns over the $94,316 Family Tax Benefit income cap. In other words, your benefit may be significantly reduced or disappear altogether.
In another bold move, the Government has introduced its promised no jab, no pay policy. If you refuse to immunise your kids, your Family Tax Benefit will be reduced by $28 a fortnight, per child. That's a whopping $56 if you have a couple children. The Government's message is clear on this one: "Vaccinate or we hit you where it hurts."
This is one area where the government is stealing from the rich and giving to the poor (well, less well-off). As promised, if your family has a combined household income of less than $185,710 there will no longer be a cap on the childcare costs you can claim. If your family earns over this amount, you will now be allowed rebates up to $10,000, except for those super-super wealthy families out there racking in a combined income of $350,000 a year - you'll be cut off from government rebates entirely. That's the way the cookie crumbles.
One of the most controversial topics in the lead up to this year's budget has been negative gearing and the effect on housing affordability for the younger generation. However if you're one of the families with an investment property (or you're thinking of buying one) your negative gearing benefits have been slashed… only a minuscule amount though.
The Government has always been pretty generous with what they'll allow you to claim to reduce your tax bill but, off the back of much heated debate, tougher rules will come into force namely around travel expenses and depreciation deductions.
No longer will you be able to claim for travel expenses to your investment for inspections, maintenance and to pick up rent.
When it comes to depreciation of property assets such as washing machines and air-conditioners, you will only be able to claim depression if you actually bought the asset.
It's hoped these two moves will stop investors rorting the system... too much (sorry).