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Navigating 2024: Economic Insights and Business Implications

Updated: Jan 23

Changes coming in 2024

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As we usher in 2024, the economic landscape continues to undergo transformations, influenced by a variety of factors. In this article, we delve into some of the pivotal issues that will shape the year ahead. 

Inflation and Labor Supply

Reserve Bank of Australia (RBA) Governor Michelle Bullock recently remarked that inflation has crested its peak and is on a favourable trajectory. However, she cautioned that the return to the target might be more gradual than initially anticipated. While there are positive signs, uncertainties linger on the domestic front. Inflation remains persistent, with a slowed growth rate, even as the labour market maintains its tight grip. The Australian economy faces external risks, primarily tied to uncertainties surrounding the Chinese economy and ongoing international conflicts. The RBA, in response, has left the door open for potential interest rate increases. 

As of now, the unemployment rate holds steady at 3.7%, indicating a labor market characterized by scarcity. Wages, too, have witnessed a noteworthy ascent, growing by 1.3% in the September 2023 quarter and reaching a 14-year high with a 4.0% increase over the year. The challenge lies in sourcing high-skilled workers, with employers hesitating to meet inflated salary expectations. 

Income Tax Cuts and Concessions

Effective July 1, 2024, the implementation of stage 3 tax cuts will usher in a significant overhaul of personal income tax brackets. The consolidation of the 32.5% and 37% tax brackets into a unified 30% rate is poised to streamline the tax system for individuals earning between $45,001 and $200,000. 

Additionally, the superannuation guarantee rate is slated to rise to 11.5% on July 1, 2024. However, for small and medium businesses with a group turnover of less than $50 million, the conclusion or reduction of several concessions looms large. Notable changes include the conclusion of the Skills and Training Boost on June 30, 2024, offering a 20% bonus deduction for eligible training expenditure. The fate of the Small Business Energy Incentive, scheduled to end on June 30, 2024, remains contingent on parliamentary approval. This incentive aims to provide an extra 20% deduction for eligible depreciating assets supporting electrification and energy efficiency. The instant asset write-off, slated to reduce back to $1,000 from July 1, 2024, awaits legislative approval, with the cost threshold targeting $20,000 for the 2024 financial year. 

Worker Rights and Rewards

The workplace landscape has undergone substantial changes in 2023, setting the stage for increased scrutiny in 2024. Key developments include a 5.75% increase in the minimum wage to $23.23 per hour from July 1, 2023. New rules have been implemented, placing a two-year limit on some fixed-term employment contracts, with no option for renewal. A landmark case has defined criteria for distinguishing between a worker as a contractor or employee, prompting the Australian Taxation Office (ATO) to issue new rulings ensuring correct entitlement payments by employers. Notably, there is now greater flexibility for unpaid parental leave. 


As we traverse the uncertainties of 2024, staying abreast of these economic and policy changes becomes imperative for businesses and individuals alike. The dynamic nature of these shifts emphasizes the need for adaptability and proactive engagement with the evolving landscape. Keep a vigilant eye on further updates and announcements to navigate the complexities of the year ahead effectively. 


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