What are the tax rate changes?
Australia’s Treasury Laws Amendment (More Cost of Living Relief) Act 2025 introduces permanent changes to personal income tax rates for residents:
- From 1 July 2026, the lowest non-zero marginal rate drops: income over the tax-free threshold up to $45,000 will be taxed at 15%, down from 16%. (ato.gov.au)
- From 1 July 2027, that same bracket rate decreases further to 14%. (ato.gov.au)
Higher brackets (30%, 37%, 45%) remain for higher incomes ($45,000-$135,000; $135,000-$190,000; over $190,000, respectively).