Invest
‘This will be another pandemic budget’: Frydenberg
The Australian government will use next month’s budget to target Australia’s unemployment rate and reduce taxes paid as it looks to support the economy post the COVID-19 downturn.
‘This will be another pandemic budget’: Frydenberg
The Australian government will use next month’s budget to target Australia’s unemployment rate and reduce taxes paid as it looks to support the economy post the COVID-19 downturn.
In a speech made ahead of the 11 May federal budget, Treasurer Josh Frydenberg said he plans to delay budget repairs to instead focus on the unemployment rate.
“We will not move to the second phase of our fiscal strategy until we are confident that we have secured our economic recovery,” Mr Frydenberg said.
The Treasurer discussed Australia’s need to drive unemployment down to below 5 per cent for the first time since 2008.
Mr Frydenberg has been adamant that in order to fix the budget deficit, Australia must first fix the economy. He noted on Thursday that for inflation to lift, “the unemployment rate will have to have a 4 in front of it”.
“Just as recently as the mid-year economic and fiscal update in December last year, we thought the unemployment rate would be 7.5 per cent, it is now at 5.6 per cent,”
“That means 200,000 more Australians are in work, and that can improve the budget bottom line by around $5 billion because you have $3 billion less in welfare payments going out and $2 billion more in revenue through taxes coming in,” the Treasurer said.
The Treasurer had previously said that once unemployment was “comfortably below” 6 per cent, the government would shift from providing temporary support to stabilising debt. But tactics appear to have changed, with the government said to be less afraid of the mounting debt, now stating “we won’t be undertaking any sharp pivots towards austerity”.
However, the government will refuse to bring back key policies, including the JobKeeper stimulus, instead aiming for more targeted support.
Tax cuts on the way?
While Mr Frydenberg refused to commit to any major changes to the tax policy, he said the government remains “committed to lowering taxes”.
The next stage of the government’s tax plan is stage three tax cuts, which are due to commence in 1 July 2024, with the Treasurer alluding on Thursday to bringing these forward.
The stage three tax cuts are the largest and most controversial reform to the current system, with all Australian workers earning between $45,000 and $200,000 set to receive the same flat 30 per cent tax rate.
“We will continue to drive lower taxes, whether it’s for businesses or individuals; these are announcements that have already been made and policies that are currently being implemented,” he concluded.
RELATED ARTICLES
About the author
About the author
Economy
Australian inflation continues downward trend, nearing RBA target
The Australian Bureau of Statistics (ABS) has reported that the Consumer Price Index (CPI) rose 2.7 per cent in the year to August, down from 3.5 per cent in July and 3.8 per cent in June. Read more
Economy
UK markets poised for gains after election, global geopolitical risks remain
Chris Iggo, Chief Investment Officer at AXA Investment Managers, has provided an optimistic outlook for UK markets following the recent general election, while cautioning about ongoing global ...Read more
Economy
Co-ops and mutuals boost revenue to $43.2 billion despite economic challenges
Australia's top 100 co-operative and mutual businesses have posted a record performance in the 2023 financial year, growing total revenue by 16.1 percent to $43.2 billion. Read more
Economy
Fed decision set to pressure emerging market central banks to hike rates
The Federal Reserve's expected decision to maintain US interest rates at a two-decade high at its sixth consecutive meeting on Wednesday is set to put pressure on emerging market central banks to hike ...Read more
Economy
Fed keeps rates steady, signals higher for longer amid elevated inflation
The Federal Reserve kept interest rates unchanged at its May meeting and signaled that rates are likely to stay higher for longer given elevated inflation in the first quarter, while also announcing a ...Read more
Economy
CPI data another piece in RBA's interest rate decision puzzle, says REIA
The latest Consumer Price Index (CPI) data from the Australian Bureau of Statistics (ABS) shows that inflation rose 3.4% in the 12 months to February 2024, unchanged from the previous two months, ...Read more
Economy
Including passive job seekers in unemployment measure doesn't impact economic cycle view, study finds
New research from e61 Institute has found that while current unemployment measures may not capture all job seekers, broader definitions that include passive job searchers do not provide better ...Read more
Economy
Survey reveals heightened job security concerns among IT workers in 2024
A recent survey conducted by Authority Hacker has revealed that 89.66% of IT workers in the United States have increased concerns about job loss in 2024. Read more
Economy
Australian inflation continues downward trend, nearing RBA target
The Australian Bureau of Statistics (ABS) has reported that the Consumer Price Index (CPI) rose 2.7 per cent in the year to August, down from 3.5 per cent in July and 3.8 per cent in June. Read more
Economy
UK markets poised for gains after election, global geopolitical risks remain
Chris Iggo, Chief Investment Officer at AXA Investment Managers, has provided an optimistic outlook for UK markets following the recent general election, while cautioning about ongoing global ...Read more
Economy
Co-ops and mutuals boost revenue to $43.2 billion despite economic challenges
Australia's top 100 co-operative and mutual businesses have posted a record performance in the 2023 financial year, growing total revenue by 16.1 percent to $43.2 billion. Read more
Economy
Fed decision set to pressure emerging market central banks to hike rates
The Federal Reserve's expected decision to maintain US interest rates at a two-decade high at its sixth consecutive meeting on Wednesday is set to put pressure on emerging market central banks to hike ...Read more
Economy
Fed keeps rates steady, signals higher for longer amid elevated inflation
The Federal Reserve kept interest rates unchanged at its May meeting and signaled that rates are likely to stay higher for longer given elevated inflation in the first quarter, while also announcing a ...Read more
Economy
CPI data another piece in RBA's interest rate decision puzzle, says REIA
The latest Consumer Price Index (CPI) data from the Australian Bureau of Statistics (ABS) shows that inflation rose 3.4% in the 12 months to February 2024, unchanged from the previous two months, ...Read more
Economy
Including passive job seekers in unemployment measure doesn't impact economic cycle view, study finds
New research from e61 Institute has found that while current unemployment measures may not capture all job seekers, broader definitions that include passive job searchers do not provide better ...Read more
Economy
Survey reveals heightened job security concerns among IT workers in 2024
A recent survey conducted by Authority Hacker has revealed that 89.66% of IT workers in the United States have increased concerns about job loss in 2024. Read more
