Federal Budget 2017-18: AAA Credit Rating to Remain
Posted on May 10th, 2017
IS SMALL BUSINESS THE WINNER IN THIS YEAR’S FEDERAL BUDGET?
LAST YEAR’S FEDERAL BUDGET SUMMARY FOR CQ outlined some major announcements in our region including $130 million for Rookwood Weir and a $1 billion Defence spend, as well as tax incentives for small business.
This year’s FEDERAL BUDGET 2017 extends those tax incentives for small business and includes some major national initiatives regarding infrastructure ($75 B), affordable housing and health ($10 B) with some major levies to increase income, including a big banks levy ($6.2 B), Medicare levy ($6.2 B) and a Foreign worker levy ($1.2 B). As with any Federal (or State) Budget, there is both positive and negative commentary depending on what sector people are focused upon but the retention of the AAA Credit Rating for Australia cannot be ignored.
For small business, the words ‘business confidence to invest in themselves’ and ‘some great wins for business’ seem to be a common theme amongst political commentators and economists in response to this budget.
HIGHLIGHTS FOR SMALL BUSINESS 2017/2018 (which make up 99% of all business which contribute $380 billion to the national economy)
- $20,000 instant asset write-off has been extended for another 12 months
- Lower taxation – 27.5 per cent tax rate for businesses with an annual turnover less than $10 million expected to assist about 90,000 additional businesses. (part of the Government’s Ten Year Enterprise Tax Plan announced in last year’s 2016–17 Budget)
- Unincorporated businesses with annual turnover of less than $5 million tax discount to 8 per cent
- A commitment to cutting the company tax rate to 25 per cent for all businesses and reducing regulatory burden
- Through its National Partnership on Regulatory Reform, the Government will provide up to $300 million over two years to States that reduce unnecessary regulatory restrictions on competition and small businesses
TOURISM: Queensland Tourism Industry Council have prepared a summary of pros and cons for the state’s Tourism Industry. Click here.
Those looking for big ticket funding announcements for CQ will inevitably express their disappointment, but there are some innovative surprises for first home buyers and for those 65 and over to address housing affordability.
Federal Member for Capricornia, Michelle Landry MP, has summarised localised opportunities, with regional areas like ours affected by the following:
REGIONAL GROWTH FUND: $472 million in regional investments to support a Regional Growth Fund for local infrastructure projects, including $200 million to support a second round of the Building Better Regions Fund.
NBN: By mid-2017, the network will be available to half of all Australian premises, further expanding to around 9 million premises by mid 2018, to be completed by 2020.
The Government is providing $7 million to the ACCC to implement a new Broadband Performance Monitoring and Reporting program to provide consumers with access to more information on the speeds and experience they can expect from fixed-line broadband services delivered over the nbn.
HEALTH: A package of more than $165 million will continue to prioritise mental health support and prevention, including $80 million for community psychosocial services, over $50 million to support veterans and $15 million for research initiatives at Orygen, the Black Dog Institute and the Thompson Institute.
A further $15.5 million will be provided to support more than 2,000 aspiring and high performance athletes in the lead up to the 2018 Gold Coast Commonwealth Games.
$1.2 billion will be provided for new and amended listings on the PBS, including more than $510 million for a new medicine for patients with chronic heart failure.
ENERGY: The Government has asked the ACCC to undertake inquiries into competition in retail electricity and gas markets and will provide around $90 million to promote gas supply and has secured gas industry commitments to improve domestic supply. The Clean Energy Finance Corporation has provided more than $3 billion of support to new technologies.
SUMMARY: According to the Australian Government, growth in the Australian economy is expected to rebound to 2¾ per cent in 2017-18 and 3 per cent in 2018-19 as the detraction from mining investment eases and as growth in household consumption and non-mining business investment improves.
Kennas have provided this helpful summary for individuals and businesses.
The Australian Institute of Company Directors have issued the following summaries: