FEDERAL BUDGET – WHAT WE KNOW SO FAR:
THE BIG PICTURE
* With the COVID-19 pandemic, flooding and Ukraine-Russia war creating headwinds, Treasurer Josh Frydenberg is emphasising the “fiscal dividend of a stronger economy”.
* Budget deficit estimated to be around $70 billion, instead of the $98.9 billion estimated in the mid-year budget review in December 2021
* Debt is edging towards $1 trillion, but budget papers will show it stabilising before declining in the medium term based on continuing economic growth
* Unemployment on four per cent (February official figure)
* Budget papers will give a conservative estimate of revenue from minerals such as coal and iron ore, despite them earning record prices
THE GOVERNMENT’S PLAN
* Keep in place a tax-to-GDP ratio at or below 23.9 per cent
* Infrastructure investment
* Boosting skills
* Driving new manufacturing
* Energy plan
* Digital economy
* Modest budget repair
* Improving service delivery and funding national security measures
* “Targeted and proportionate” cost of living relief, possibly cash payments for low and middle-income earners
* Expected (but not confirmed) to include another 12 months of the low and middle income tax offset
* Bring forward of child care subsidy changes from July 1 to March 7, to cost around $224 million in 2021/22 and $670 million a year ongoing
* Pension and welfare payments rise from March 20, benefiting 4.9 million people and costing the budget $2.2 billion extra over the year
* No bringing forward of high-end income tax cuts
* $1.85 billion in cash flow support for 2.3 million small businesses by lowering tax instalments in 2022/23
* $800 million over 10 years for strategic and scientific research and exploration in Antarctica.
* $86 million forestry industry support in Tasmania
* $60 million for recycling modernisation
* National biosecurity strategy
* $10 billion over two decades set aside for an east coast submarine base in Queensland or NSW
* $4.3 billion to help build a new dry dock facility in Henderson, Western Australia, with construction to start in 2023
* Defence spending expected to be around 2.1 per cent of GDP
* $282 million in the Northern Territory for 34 capability projects and maintenance and servicing work
* Support for Ukraine military forces
* $500 million for Urannah dam in central Queensland
* $678 million for the sealing of 1000km of the Outback Way
* $2.26 billion for Adelaide’s North-South corridor motorway
* $40 million for bridges
* $74 million top-up for Perth city deal
* $668 million for southeast Queensland city deal
* $5.4 billion for Hells Gates dam in north Queensland
* $189 million over five years to strengthen prevention and early-intervention efforts in family, domestic and sexual violence
* $104 million to prevent technology and devices being used to perpetrate or facilitate family, domestic and sexual violence.
* $128.5 million reform package to provide greater certainty around environmental protection and streamline assessments
* Deregulation using international safety standards to save businesses $136 million a year
* Waiving of fees and taxes for reef-based industries over 2022/23 financial year.
* Medicare to cost around $126 billion over four-year forward estimates
* Four-year rolling funding agreement and annual increases from July 1, 2023, for Aboriginal Community Controlled Health Services
* $61.2 million for the Australian Genomic Cancer Medical Centre to research and develop drugs for people with advanced cancers
* $315 million over four years to extend its national ice drug action strategy
* $700 million for regional health specialist training
* $6.4 billion for independent schools, growing to $8.5 billion by 2029.
* $1.2 billion over four years for an expanded Transition to Work employment service for disadvantaged youth
* Support for Indigenous boarding students
* Critical minerals industry to get $200 million Accelerator grants program, $50 million to support research and development and an updated industry strategy.
* $55.4 million for BlueScope Steel’s Advanced Steel Manufacturing Precinct around the Port Kembla steelworks.
If you would like to know more, feel that you or anyone you know requires advice, or would simply like a review of your financial situation, please visit our contact page call our office today to arrange an appointment on (07) 5574 0667.
We encourage all of our clients and colleagues to Like and Follow us on Facebook as we will be posting exclusive content including business updates throughout 2022.
Note: This communication (including taxation) is general advice only and does not consider your personal circumstances. You should consider whether the information is appropriate to your individual needs, and not act on any information without obtaining professional financial advice specific to your circumstances. This communication including any attachments is intended solely for the use of the individual to whom it is addressed. Any unauthorised use, dissemination, forwarding, printing, or copying of this communication including any attachments is prohibited. It is your responsibility to scan this communication including any file attachment for viruses and other defects. To the extent permitted by law, we will not be liable for any loss or damage arising in any way from this communication including file attachments.
The information has been given in good faith and has been prepared based on information that is believed to be accurate and reliable at the time of publication. The information is general in nature and does not take into account your particular financial needs, circumstances and objectives.