House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Treasurer, the Hon J. B. Hockey MP)

General outline and financial impact

Medicare levy and Medicare levy surcharge low income thresholds

This Bill amends the Medicare Levy Act 1986 and the A New Tax System (Medicare Levy Surcharge - Fringe Benefits) Act 1999 to:

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increase the Medicare levy low-income thresholds for individuals and families (along with the dependent child/student component of the family threshold) in line with movements in the consumer price index (CPI);

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increase the Medicare levy low-income threshold for single taxpayers eligible for the seniors and pensioners tax offset, in line with movements in the CPI, so that they do not have a Medicare levy liability where they do not have an income tax liability; and

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increase the Medicare levy surcharge low-income threshold in line with movements in the CPI.

Date of effect : This measure applies to the 2014-15 income year and later income years.

Proposal announced : This measure was announced in the 2015-16 Budget.

Financial impact : This measure has the following revenue impact:

Human rights implications : This Bill does not raise any human rights issue. See Statement of Compatibility with Human Rights - paragraphs 1.22 to 1.26.

Compliance cost impact : Nil.