Australian budget

Victoria has the nation’s largest per capita debt and the lowest credit rating.

Deloitte Access Economics expects the federal government to post an underlying budget deficit of $33.5 billion for 2024–25, following a surplus of $15.8 billion for the 2023–24 financial year.

We have repeatedly warned that Victoria’s state debt burden is problematic.

The Future Fund, which is one-third the size of the Australian economy, will be directed to invest in housing, security, and the green energy transition “where possible, appropriate, and consistent with strong returns”.

Data from the Australian Bureau of Statistics (ABS), published in The Australian, shows that 26,100 permanent positions have been added to the federal public service since Labor took office in May 2022.

The prospect of Donald Trump winning this week’s US election has Australia’s business lobby laying the groundwork for a cut to Australia’s company tax rate.

The former Grattan Institute Transport and Cities Program director, Marion Terrill, has lambasted the Victorian government for pursuing the “ruinously expensive” Suburban Loop Project (SRL), which risks burying taxpayers in debt.

Behold the DXY express elevator: And AUD lift to hell: North Asia is no help: Gold and DXY do not move like this together.

The Australian Chamber of Commerce and Industry (ACCI) has called on both sides of politics to address the issue of tax reform in the lead-up to the next federal election, with CEO Andrew McKellar noting that it is now over 25 years since the GST was introduced.

Analysis by consulting firm EY suggests that the federal government will need to borrow about $90 billion in 2024-25 to finance its spending programs.

The National Disability Insurance Scheme (NDIS) presently costs around $42 billion and has a higher annual operating cost than aged care ($36 billion), Medicare ($32 billion), federal hospital financing ($30 billion), and medicines ($20 billion).

I wrote on Monday about how global ratings agency Standard and Poors has warned the Victorian government that it risks a credit rating downgrade and spiralling debt repayments if it proceeds with the $200 billion Suburban Rail Loop (SRL) boondoggle.

Earlier this year, The AFR posted the following chart showing the enormous growth in Australia’s terms of trade over the past 20 years: The AFR’s John Kehoe noted that “compared to other countries”, Australia’s terms-of-trade “has increased by almost two and a half times, or 146% since the turn of the century”.

Earlier this year, The SMH published the following chart derived from Treasury data, illustrating the drivers behind the rise in income tax receipts in recent years: The purple bars above indicate that the “growth in the tax filer population” is a significant factor contributing to the increase in personal income taxes.

The Penington Institute’s CEO, John Ryan, says cannabis has become an integral part of the criminal economy, and he contends that the drug is a health problem rather than a law and order problem.

In January, The AFR reported that plans to triple foreign investment fees for purchases of established homes and to double the vacancy fee for homes that overseas investors own could breach double-taxation agreements with eight countries, including India.

Since the day that former Victorian Premier Daniel Andrews made the “captain’s call” to announce the Suburban Rail Loop (SRL) project, it has never stacked up economically or socially.

Shane Wright has given us another warning of the tax iceberg in the water dead ahead. At the end of the day, the simple question is: What do we (as in our governments) do?

In March, the Centre for Independent Studies (CIS) released research showing that bracket creep will quickly eat away at the upcoming Stage 3 tax cuts.

With the Coalition hoping to win back women voters at the next election, deputy Nationals leader Perin Davey says the idea of income splitting between partners has merit.

Justin Fabo at Antipodean Macro has done a great job illustrating the deterioration in NSW’s budget outlook following Tuesday’s State Budget: As shown above, NSW’s general government operating balances are now expected to be in deficit over the forward estimates to 2027-28.