Finance Work Treasurer coy on possible tax hike for thousands of Australians
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Treasurer coy on possible tax hike for thousands of Australians

Josh Frydenberg
Josh Frydenberg has conceded to Independent Dr Monique Ryan in the seat of Kooyong. Photo: AAP
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Treasurer Josh Frydenberg has refused to comment on reports the federal government is mulling dumping the $1080 annual tax offset for low income-earners – a move that would be an effective tax rise for tens of thousands of Australians.

Mr Frydenberg will hand down the federal budget on March 29, earlier than its traditional release in May due to the upcoming federal election.

The low and middle income tax offset provides a tax cut of up to $1080 to everyone earning less than $126,000 a year. It has already been extended twice, and is due to end in June.

However, it had been widely predicted that Mr Frydenberg would extend the measure again, as a pre-election sweetener.

But The Sydney Morning Herald reported on Monday that, with the economy rebounding more quickly than forecast, the annual $7.8 billion cost of the offset to the federal government’s bottom line is coming into sharper focus.

“We haven’t made a decision as to whether or not we’re going to extend the low and middle income tax offset. We have in previous budgets,” Mr Frydenberg told ABC radio on Monday.

In other tax speculation, the beer industry wants a 50 per cent cut in excise duty after feeling the impact coronavirus pandemic lockdowns.

Australian Tax Office figures show that pubs and clubs sold 40 million fewer pints of beer between July and September last year than they did during the same period in 2019 and before the COVID-19 hit.

Even so, the industry was hit with additional excise in February, as excise rates for alcohol are indexed twice a year in line with the consumer price index.

“I know what the industry has been asking for, like all industries, and they put in budget bids,” Mr Frydenberg said.

“They’ll be considered, they’ll be looked at in the context of all the different priorities we have.”

-with AAP