Government scraps Medicare levy increase

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The Turnbull government will scrap the proposed $8.2 billion increase in the Medicare Levy.

The proposed increase, from 2 to 2.5 percent, announced in last year's Budget was designed to help fill a funding shortfall for the National Disability Insurance Scheme. It was planned to be introduced on 1 July 2019.

The government has been unable to win political support from Labor and the Greens to secure parliamentary approval for the across-the-board increase.

Treasurer Scott Morrison will announce the decision in a speech to the Australian Business Economists today. He will cite the government's improved budget position as the reason for the decision.

“A year later, our fiscal position has improved. Our economy is stronger and it is continuing to strengthen under the Turnbull Government’s national economic plan.

“That is why we are now in a position to give our guarantee to Australians living with a disability and their families and carers that all planned expenditure on the NDIS will be able to be met in this year’s Budget and beyond without any longer having to increase the Medicare levy."