Treasurer Scott Morrison Delivers 2017 Federal Budget

The Treasurer, Scott Morrison, has delivered the Turnbull government’s second Budget, forecasting a return to surplus in four years, abandoning stalled budget cuts, guaranteeing Medicare and the PBS, incresing the Medicare levy and imposing a new levy on the commercial banks.

The Budget also includes provisions for first home buyers to salary sacrifice into their superannuation. It includes a crackdown on welfare recipients.

The Budget marks a break with the Abbott years. It abandons the “zombie” cuts stalled in the Senate whilst increasing spending in traditional Labor areas. Morrison said it was a “reset”.

  • Listen to Scott Morrison deliver the Budget (32m)
  • Watch Morrison (32m)

Budget Documents – PDF downloads

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ALP Releases Policy To Cut Back Negative Gearing

An ALP policy released today proposes that negative gearing will only be available from July 1, 2017 for newly constructed homes.

Announcing the policy at the NSW ALP State Conference, Opposition Leader Bill Shorten said all current investments will be grandfathered.

In a further measure, the capital gains tax discount will be reduced from 50 per cent to 25 per cent.

The full policy appears below.

Statement from Opposition Leader Bill Shorten

ALP

A strong and sustainable budget is necessary so we can fund our priorities of health and education and underwrite our nation’s future. [Read more…]


Australia Institute Proposes Capital Gains Tax On Home Worth More Than $2 Million

The Australia Institute says capital gains tax exemptions on homes worth over $2 million are costing the federal budget billions of dollars.

Capital gains tax is not payable on the sale of the main residence. The Treasury says this costs the budget $46 billion each financial year.

The Australia Institute report proposes scaling back capital gains tax exemptions for homes worth more than $2 million. It says this would raise $12 billion over four years.

The Institute, a progressive think tank, says the proposal should be considered because it costs more than the federal government spends on defence ($26.3bn), education ($31.9bn) or Medicare ($21.1bn).

The report was prepared by the institute’s senior economist, Matt Grudnoff.

The report is shown below. It can be expanded and downloaded.

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COAG Discussions Focus On Terrorism, Federation And Taxation

The Council of Australian Governments met in Canberra and discussed a range of issues, including terrorism, reform of the Federation and the taxation system.

COAG

The Prime Minister, Tony Abbott, held a joint press conference following the meeting. He was accompanied by Premiers Baird, Napthine, Newman, Barnett, Weatherill and Hodgman, as well as the Territory Chief Ministers Gallagher and Giles. Felicity-Ann Lewis represented Local Government. [Read more…]


Bowen And Hockey Spar Over Interest Rate Decision

The Treasurer, Chris Bowen, has defended today’s interest rate decision by the Reserve Bank, whilst the shadow Treasurer, Joe Hockey, says the economy is weakening.

At a press conference following the Bank’s decision to cut the cash rate by 25 basis points to 2.5%, Bowen said lower interest rates contributed to lower living costs for Australians, particularly in housing. [Read more…]


A Tax and Welfare Package As Much As An Environmental Plan

After labouring for months, the Multi-Party Climate Change Committee has brought forth a tax and welfare package as much as an environmental policy.

The DrumWith significant implications for the welfare sector, and tax cuts for everyone earning up to $80,000 a year, in the short term the carbon tax may not be the most important effect of the government’s plan.

The government says around 60% of taxpayers will get a tax cut of at least $300 from July next year, and no one will pay more tax. In 2015-16, further tax cuts come into effect.

The tax free threshold will be raised to $18,200. Treasurer Wayne Swan says up to a million extra Australians will be freed from having to lodge a tax return from next financial year. Many low-income earners who have to deal with the Taxation Office and Centrelink will find they only have to deal with Centrelink. Like the general tax cuts, the tax free threshold will increase again to $19,400 in 2015 when the fixed price on carbon is replaced by the emissions trading scheme. [Read more…]


Ken Henry’s Address To The National Press Club

The Treasury Secretary, Ken Henry, has addressed the National Press Club, in Canberra.

HenryAn affable, confident, articulate and impressive Henry delivered a speech on taxation and then took questions on allegations from the Liberal Party that he has conspired with the Federal government to manipulate the economic growth forecasts.

The speech introduced Jim from Jericho, an Australian equivalent of Joe the Plumber, who gave Henry a lesson on the taxation of fencing wire.

  • Listen to Ken Henry’s speech (55m)

Text of Ken Henry’s prepared speech:

Towards a tax and transfer system of human scale

1. My working holiday

As people all around the world quickly learned – such is the reach of the electronic media these days – I spent July with my wife, Naomi, in the Epping Forest Scientific National Park in central Queensland, helping look after what may be the last 115 northern hairy nosed wombats left on the planet.

The care of our native wildlife is one of my passions. Another is tax policy. That, too, has occupied a fair bit of my time this year as we have been undertaking one of the most fundamental tax reviews ever attempted in this country.

Spending time on one’s passions would normally be considered a good thing. In some respects, then, this has been a good year. [Read more…]