Providers who will benefit include mental health, disability, domestic violence and homelessness services, the Medicare Benefits Schedule and community nursing. 'We have always supported tax relief for people on low and middle incomes,' he said.ĭr Chalmers announced the budget will also increase indexation to provide $4 billion more to community services. He said the tax cuts were one way to restore bracket creep, where inflated wages mean people end up paying proportionately more in tax, and the cuts would kick in at the relatively modest level of $45,000 a year. 'Our position hasn't changed,' Dr Chalmers said. On the controversial state three tax cuts inherited from the Morrison Coalition government, the Treasurer again batted back suggestions they will be axed. The Treasurer said these measures would mean 'more tax sooner from these projects and it means it can help fund our cost of living package and other priorities in the budget'. The amount of government assistance households and small businesses receive will depend on their locationĭr Chalmers said there had been 'widespread consultation' with the sector on the changes, which from July 1 will cap the amount companies can deduct project costs against income. 'Only about a fifth (of the improvement) is from higher the commodity prices, the biggest improvement, 40 per cent of it is from the labour market, lower unemployment and higher wages growth.'Īnother measure that will also help the budget's bottom line is a $2.4 billion increase in Petroleum Resource Rent Tax, to be paid by oil and gas companies on their offshore liquefied natural gas projects over the next four years. 'Commodities are an important part of the story but not the biggest part of the story,' he asserted.
'The pressures on the budget after that (the next year) will intensify rather than ease,' he said after being asked about heavy new defence expenditure and the spiralling costs of the National Disability Insurance Scheme.ĭr Chalmers said it was a misconception the budget's improved condition was solely due to the tax being harvested from the sky-rocketing price of commodities, such as iron ore. The Treasurer stressed the high intake of 300,000 migrants this year and a projected 400,000 next year was not a result of government targets but a rapid return of overseas students and long-term tourists after the Covid pandemic border closures.Īlthough the budget is widely expected to return to a surprise surplus, Dr Chalmers warned it might only be temporary. However, he was not expecting average wage growth to overtake inflation, and thus increase real spending power, until the beginning of next year.ĭr Chalmers warned the budget would forecast a slowing economy and that would be felt even more per person as a high influx of migrants overshadows economic growth, which could lead to a 'per capita recession'. 'What we have tried to do with the budget broadly particularly the cost of living package is to try to take some of the pressure off inflation rather than add to it,' he said.ĭr Chalmers voiced optimism inflation could be brought under control sooner than previously forecast. The measure will also be targeted to help the 'most vulnerable' but won't just be restricted to age pensioners with Dr Chalmers promising the budget would help dull the edge of runaway inflation. Treasurer Jim Chalmers has promised the budget will contain measures to help ease the pressure of soaring power bills for millions of Aussie households
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