Australia
Faces ‘Massive Hit’ to Government Revenue, Swan Says
Australia
faces a “massive hit” to government revenue, pushing the nation
further into deficit ahead of an election in September, Treasurer
Wayne Swan said.
18
March, 2013
The
national budget fell a further A$4.6 billion ($4.8 billion) into
deficit in the first four weeks of 2013, taking the total shortfall
to A$26.8 billion for the first seven months of the financial year,
according to Treasury figures released by the government March 15.
Just three week ago, Swan predicted a reduction in revenue would add
just A$2 billion to the deficit in January.
“One
of the big challenges we face is a massive hit to government
revenues,” Swan said in a weekly economic note yesterday. Revenue
downgrades “will inevitably continue to impact beyond the current
year.”
Labor
Prime Minister Julia Gillard’s bid to overcome the opposition
Liberal-National coalition’s lead in opinion polls is being damaged
by weaker growth, lower prices for Australia’s resources, and a
strong local currency that’s curbing tax receipts. Gillard, the
nation’s first female leader, was forced in December to abandon a
pledge to return the budget to a surplus this year.
“We
will not put growth and jobs in our economy at risk by cutting
further and deeper in the near term to fill in a hole in revenues,”
said Swan.
In
its October mid-year review, the government forecast a budget surplus
of A$1.08 billion in the 12 months ending June 30. It recorded a A$44
billion deficit last fiscal year.
Income
Tax
Government
revenues rose 7.7 percent during the first seven months of the
financial year, compared with the same period in 2011-2012, according
to Treasury figures released March 15 by Finance Minister Penny Wong.
Spending
was up by 3.6 percent. Personal income tax payments were up 9.8
percent, more than the 8.4 percent forecast in the budget update in
October. Company tax receipts fell 1.6 percent.
The
Labor government’s support among voters rose 3 percentage points to
48 percent on a two-party preferred basis, with Tony Abbott’s
Liberal-National coalition falling 3 points to 52 percent, according
to a Newspoll survey published in the Australian newspaper March 12.
Gillard’s
so-called minerals resource rent tax, which puts a 30 percent levy on
iron-ore and coal profits, raised A$126 million in its first six
months, trailing targets, the government said last month. Abbott says
the shortfall in revenue is an example of the government’s fiscal
bungling
No comments:
Post a Comment
Note: only a member of this blog may post a comment.