Shortly after the release of the Henry Review recommendations, the Federal Budget was handed down. Treasurer Swan announced the budget as being a “comprehensive strategy for guiding Australia in the aftermath of the worst global economic upheaval since the Great Depression.” He also stated that “this budget wasn’t designed to shift opinion polls and I don’t believe they will.” Let me assure everyone – they won’t!
The success of this budget will rely very heavily on the success of the Resources Super Profits Tax (“RSPT”).
A summary of the budget announcements include:
- Carried forward of 2007 tax cuts
- Tick and flick ITR’s ($500 from 1/7/2012 and $1,000 from 1/7/2013
- 50% discount on tax of first $1,00 of interest income from 1/7/2011
- Revamp of first home buyer accounts
- $2.2 billion on health ($772m on GP’s & $523m on training of nurses)
- $1 billion on infrastructure for Australian Rail
- $660m on training (70,000 new places, 22,500 youth apprenticeships and $120m on numeracy courses)
- Small business receive an extra $3,350 for new apprentices <19 yrs
- $273 m for child care (raising standards and increase child to staff ratio’s)
- Higher tax on cigarettes
- Changes to Pharmaceutical Benefits Scheme
- Super co-contribution slashed and income thresholds frozen
- Extend Deductible Gift Recipient to volunteer fire brigades
- $420m to ATO for a GST and Cash economy crackdown
- $65m over 4 years to Treasury to develop and implement the Governments response to the Henry tax review recommendations
