The good news from the budget
- The Government will provide $100 million over 4 years for minerals exploration, by giving small explorers not making any taxable income access to a refundable tax offset for their Australian shareholders.
- The Government has spared mining an increase in the diesel fuel excise. Currently commercial vehicles used in mining and agriculture get a rebate on the diesel fuel excise that drops it to six cents per litre. Before the budget there had been calls to raise this in line with the petrol fuel excise.
- The budget also outlines $3.4 billion over the next three years from the abolition of the Minerals Resource Rent Tax.
- The Government is bringing forward $1.5 billion in spending from 2017-18 to earlier years.
- Any efficiencies found in Defence costs will be reinvested back into Defence, unlike the majority of other Commonwealth departments who are expected to return an efficiencies.
- The Government has outlined $11.6 billion in funding for new projects.
- Part of this funding takes the form of an asset recycling scheme, where the Federal Government would give up to 15 per cent of the value of any State assets that are invested in new infrastructure projects.
- Some of the infrastructure funding comes using unallocated funding for the Building Australia Fund.
- The Government expects to raise $2.2 billion (included in the $11.6 billion) over the next four years indexing the petrol fuel excise, all of which will be channelled into roads funding.
The Private Sector
- In his speech the Treasurer has reiterated his commitment to the 1.5 per cent cut in to company tax rate along with the 1.5 per cent levy on big businesses to pay for its maternity leave. However neither figure, along with the paid parental leave scheme are listed in the detailed budget figures.
- The automotive sector will endure a net loss of money as the Federal Government has cut short or cancelled programs in response to the announcements by Toyota and Holden that they would join Ford in ceasing Australian car manufacturing.
- The budget announces the creation of the Entrepreneurs Infrastructure Programme at a cost of $484.2 million over five years, which aims to support the commercialisation of good ideas and provide market and industry information and advice.
High Income Earners
- High income earners are to be hit with a 2 per cent Debt Levy, kicking in for on incomes greater than $180,000 per year; however this levy will only affect them for three years.
- They will also be impacted by the fuel levy surcharge changes, which will see petrol prices indexed to inflation every six months, however to a lower degree than low income earners.
- The decision to reduce the maximum amount payable by the Government’s maternity leave scheme will negatively impact women earning over $100,000 per year.
- The Government has however resisted calls to clamp down on the major tax minimisation schemes, such as negative gearing and superannuation concessions, which allow high income earners to offset large portions of their income.
- However, related to the establishment of this one-stop shop, the Government is eliminating eight separate industry assistance bodies and programs that perform a similar function to save $845.6 million over five years.
- The Government has announced a $20 billion Medical Research Future Fund.
- Money for the Fund up to $20 billion will come from savings in health care revenue, including the $7.00 GP co-payment.
- The aim of the fund is to distribute ongoing funding for medical research, with these distributions to hit $1 billion by 2022-23.
- Despite this massive increase in medical research, funding for other research organisations including the CSIRO (down by $114.4 million over four years) will be reduced by $146.8 million over four years.
The bad news from the budget
All of these groups will be worse off
People with a disability
Low income earners
Ironically enough this excellent summary is brought to you by the ABC