Sandy Zubrinich, Chair, Sunshine Coast Business Council
“It’s not surprising that this budget has already being slated as a political one, given it counters many of Labor’s criticisms of the 2014 budget – a budget which this government is hoping to put well behind it with the axing of the ‘impossible to sell’ zombie measures.
Both the Australian public and our politicians have repeatedly demonstrated a lack of appetite for tough decisions when it comes to debt and deficit, which has resulted in a pragmatic yet targeted budget more focused on gaining support than tackling the difficult issues such as tax reform, which has been left for another day.
We understand the government still intends to push towards a 25 per cent tax rate for all businesses over a 10-year phasing in period. This is critical for our competitiveness as a country; especially given other countries are already moving on lowering company tax rates as a priority. The business community must continue to support the federal government to deliver the further planned cuts which have to-date been limited to smaller businesses generating under $50 million in revenue per annum.
In this budget, we see a surplus of $7.4 billion predicted by 2020/21, but we still see national debt continuing to grow after the return of operating surplus. Revenue growth appears to be predicated purely on tax measures and increasing levies rather than making much by way of spending cuts.
The increase in the Medicare levy from two per cent to two-and-a-half per cent will certainly impact working people earning over $80,000 annually when introduced in 2019, however it is essential to make sure the National Disability Insurance Scheme is well funded over time. It is important to note that on the Sunshine Coast we still have below-average household incomes with many workers still sitting below this threshold.
Also, national initiatives such as housing affordability, the first home buyers’ saving scheme, and education and health initiatives will all benefit the Sunshine Coast community.
The bank levy may take some time to filter down to families but banks are sure to recover this cost from their customers to ensure they continue to appease shareholders.
Students will also feel the pinch with fees looking to increase and existing university debts having to be paid off at the salary threshold of $42,000 per annum, down from $55,000.
No doubt incentives for first home buyers such as salary-sacrificing into super accounts at lower tax rates and the ability to add $300,000 to super for those over 65-year-olds looking to downsize will be well received.
The $10 million National Rail Program appears to be a positive initiative, although competition for projects will be fierce and there will need to be prioritisation.
Small business on the Coast can also celebrate a win with the extension of the $20,000 instant asset write off for another year and a boost of $1.5 billion over the next four years in apprenticeships and skills training. Both are very important to local small businesses.
I am unsure yet as to what $75 billion infrastructure spend will mean for the Sunshine Coast other than for the $520 million for the Bruce Highway upgrade between Pine Rivers and Caloundra. While this upgrade funding is welcomed, more information is required regarding the planned improvements. Hopefully there is more funding buried in the regional growth fund as this is a substantial stretch of road requiring significant attention.
It was good to see the Treasurer upbeat about the global and national outlook. From an economic perspective, this budget ― combined with recent announcements on issues such as company tax cuts, energy, health and education ― is generally positive for the business community and for the nation as whole and should set the economy on the path for further growth.
I hope our political parties get behind this budget and drive the economy forward.”
// Ends.
