BUDGET: First home buyers to get tax cut from July 1

In his speech, Treasurer Scott Morrison said, "for those who are trying to save to buy their first home, we will support them by providing a tax cut on their first home deposit savings."

Scott Morrison appeared much more mellow and measured as he fronted reporters in the budget lock-up. (AAP) Source: AAP

First home buyers in Australia will be provided with a tax cut, Treasurer Scott Morrison announced in Budget today.

In his speech, Treasurer Morrison said, "for those who are trying to save to buy their first home, we will support them by providing a tax cut on their first home deposit savings."

First home buyers will be able to save for a deposit by salary sacrificing into their superannuation account over and above their compulsory superannuation contribution from July 1.

The First Home Super Savers Scheme will attract the tax advantages of superannuation.

Contributions and earnings will be taxed at 15 per cent, rather than marginal rates, and withdrawals will be taxed at their marginal rate, less 30 percentage points.

Savers will not have to set up another account, they can just use their existing super account and decide how much of their income they want to put aside to save for their first home deposit.

Contributions will be limited to $30,000 per person in total and $15,000 per year.

Under this plan, most first home savers will be able accelerate their savings by at least 30 per cent.

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