The Melbourne Institute and Westpac Bank’s Consumer Confidence Index has jumped to its highest levels since 2013 – a rise of 3.9% in July, versus a 0.3% lift in June.

The figure is a 9.8% increase from July last year, reflecting booming optimism and the prospect of future proposed tax cuts.

Following a survey of 1,200 people, latest numbers reflect a 9.8% year-on-year increase.

It follows the RBA’s recent announcement to keep cash rates around record lows for the 23rd straight month.

The federal government has pledged to cut income taxes by A$140 billion over the next seven years.

The family finance index also jumped 2.3% versus the previous year, with outlook for the next 12 months climbing 2.1%.