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Veterans benefit from the New Tax System



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DVA 61 Saturday 1 July, 2000

Veterans Benefit from the New Tax System

Australian veterans and war widows will receive a 4 per cent pension rise as the Federal Government implements its compensation package under the New Tax System.

Addressing the South Australian RSL State Congress in Adelaide, the Minister for Veterans’ Affairs, Bruce Scott, told veterans the Government had delivered all of the measures promised two years ago to ensure the veteran community shared in the benefits of tax reform.

"Effective from today, all Veterans’ Affairs pensions and allowances will increase by 4 per cent, the maximum rate of rental assistance will go up by 10 per cent and income and assets test free areas will increase, giving part-pensioners increased benefits," Mr Scott said.

"From today, service pensioners can keep 60 cents in every dollar they earn over the income test free area - previously they kept only 50 cents.

"For those veterans paying income tax, they will share in the largest income tax cut in Australia’s history.

"And we are delivering the Aged Persons Savings Bonus to protect the value of veterans’ savings."

Mr Scott said the maximum pension rate for single service pensioners would rise from $372 to $386.90 a fortnight. The rate for couples will increase by $12.40 to $322.90 each.

The war widow’s pension will increase by $15.90 to $411.90 a fortnight, while income support supplements will rise to $124.90.

The 4 per cent increase in veterans’ disability pensions will see the special (TPI) rate rise to $683, with the Extreme Disablement Adjustment increasing to $388.65.

The increases will be received on payday 13 July 2000.

Mr Scott said the Government’s offer of Aged Persons Savings Bonuses had drawn an overwhelming response from the veteran community.

"My department has sent out some 300 000 application forms for the Aged Persons Savings Bonus and two-thirds of these have already been returned," he said.

"We estimate members of the veteran community will be paid some $234 million in savings bonuses. About half the applicants will receive the maximum bonus of $1000 and the average payment will be $673."

Taking into account veterans who have no investment income and those whose investment income exceeds the $30 000 cut-off point, about 95 per cent of DVA pensioners can expect to be paid a savings bonus.

"The New Tax System will more than compensate veterans and war widows for the price impacts of the goods and services tax and will ensure that the value of their pensions stays at least 2 per cent ahead of inflation," Mr Scott said.

"Today, the Government delivers a simpler and fairer tax system that will make Australians better off — and our veterans will get their fair share."

Media contact: Mark Croxford 02 6277 7820 or 0401 145 787

Departmental contact: Ric Moore (Director Tax Reform Team) 0411 241 645

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