More hip-pocket help, less vaping in new financial year

Tax cuts, energy bill relief and an increase in the minimum wage are among the raft of mid-year changes set to kick in for Australians.

Every taxpayer will keep a little more of what they earn from Monday as the long-planned stage three tax cuts kick in with a combination of other measures designed to alleviate the cost-of-living crisis.

Some economists have sounded warnings the tax cuts could add pressure to inflation, which may prompt the Reserve Bank to keep interest rates higher for struggling households or even raise them.

But with annualised inflation hitting a six-month high, consumers are feeling the pinch and likely to welcome more after-tax pay in their pockets.

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"Finally working people will be getting ahead again," ACTU Secretary Sally McManus said.

"July is a great month for working people after years of being hit with cost-of-living pressures made worse by big business price gouging."

Consumers will also enjoy a degree of power-bill relief.

All households will receive a $300 energy bill rebate, applied as four $75 quarterly deductions.

Energy prices have spiked with many people, particularly welfare recipients, unable to afford their consumption.

Paid parental leave will be increased to 22 weeks before rising to 24 weeks in July 2025, and then to 26 weeks from July 2026.

Australia's lowest-paid workers will receive a 3.75 per cent boost, their pay rising by 87 cents per hour to $24.10, or $915.91 per 38-hour week.

Unions had pushed for a bigger hike while business groups argued for smaller wage increases, claiming they could not afford rising costs.

The tax cuts close out a series of adjustments designed by the Morrison government in 2018 and there are already calls for more changes to avoid the bracket creep that over time pushes tax bills higher again.

The lowest tax rate, for people earning $45,000 or less, will drop from 19 per cent to 16 per cent.

The 32.5 per cent rate will be lowered to 30 per cent for people earning up to $135,000.

People earning above that figure will be taxed at 37 per cent, and the top tax bracket will kick in at $190,000 instead of $200,000.

The average worker will receive a cut of $1888 a year, or $36 a week.

"Australians are under the pump and that's why our budget and our economic plan are all about easing inflation and easing the cost of living with tax cuts, energy rebates and more relief set to flow from this week," Treasurer Jim Chalmers said.

"That's how you deliver cost of living relief, not with nuclear reactors that will only push up the price of power."

Other changes coming into effect from Monday include a rise in the superannuation guarantee rate to 11.5 per cent.

A national ban on engineered stone will begin, with almost 600,000 Australian workers exposed to silica dust.

Modelling from Curtin University projects about 10,000 people will develop lung cancer directly related to silica dust.

And under a reform which passed federal parliament last week, vapes will only be able to be sold at pharmacies.

Pharmacists will be able to sell vapes with limited nicotine content over the counter, once they have a discussion with the customer about health harms and confirm they're over 18.