House of Representatives

Medicare Levy Amendment (CPI Indexation) Bill 1999

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)

General outline and financial impact

Indexing thresholds

This Bill will amend the Medicare Levy Act 1986 and the A New Tax System (Medicare Levy Surcharge Fringe Benefits) Act 1999. This Bill will increase the Medicare levy low income thresholds for individuals, married couples and sole parents. It will also increase the Medicare levy surcharge low income threshold. The thresholds will increase in line with increases in the Consumer Price Index. This Bill will also increase the upper level of the shading-in of the Medicare levy for individuals as a result of the increased low income threshold.

Date of effect : The increased Medicare levy low income thresholds will apply from the 1999-2000 year of income and later years of income.

Proposal announced : The measure was announced in the Assistant Treasurer's Press Release No. 57 of 17 November 1999.

Financial impact : The measure will cost the revenue $1 million in 1999-2000, $20 million in 2000-2001 and $10 million in 2001-2002.

Compliance cost impact : Compliance costs will be negligible.


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