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Low income earners get further support

Millions of Australians on pensions and low incomes are about to get cash hits from the government, which it hopes will give another boost to the coronavirus-hit economy.

The second round of $750 payments for pensioners, veterans and carers will start going into people's bank accounts from Monday.

It goes to about five million Australians at a cost of $3.8 billion.

Treasurer Josh Frydenberg anticipates many will spend the money on everyday expenses like groceries, rent and bills.

"This will come at an important time for many people being challenged by the economic consequences of COVID-19," he told reporters on Monday.

A record number of people have already lodged their tax returns and will receive any refund owed from this week.

The government anticipates more than 10 million people earning under $126,000 will get a tax break of up to $1080.

More people could end up getting the tax offset if those who have lost jobs or part of their income because of coronavirus drop into lower tax brackets.

The government is considering bringing forward the next stage of its already legislated tax cuts, but won't reveal its decision until the October 6 budget.

Mr Frydenberg will outline the next phase of coronavirus support measures in an economic update on July 23, including the fate of the JobKeeper wage subsidy and the enhanced JobSeeker dole payment which are legislated to end in September.

He acknowledged the return to lockdowns in Melbourne would be "harsh on businesses and households".

"Our announcements on the 23rd will take into account the Victorian circumstances and that Victorians, like those in the other parts of the country who are hurting through COVID, will continue to benefit from the government's support," Mr Frydenberg said.

"We've gone for a national approach as opposed to state-specific approaches."

Melbourne's renewed shutdown has led Westpac to lower its forecast of annual growth, now saying the economy will shrink by 4.2 per cent in 2020.

Chief economist Bill Evans says a key factor will be how much of an impact the "unexpected development" in the virus spread has on consumer confidence.

The official unemployment rate is expected to rise from 7.1 per cent when June's labour force figures are released on Thursday.

Mr Frydenberg said the effective unemployment rate, after people working zero hours and those who had dropped out of the labour force were taken into account, was around 13.3 per cent.

The number of people with jobs but not working paid hours has fallen steadily to 2.8 per cent of Australians aged over 18 by the end of June, the latest data from the Australian Bureau of Statistics shows.

This was down from a peak of 7.6 per cent in early April, just after the harshest lockdown restrictions were put in place nationally.

The proportion of people who had a job was steady at 61 per cent throughout June.

© AAP 2020

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