Federal Budget 2020: Tax cuts, record infrastructure cash splash to rebound from COVID-10
Accelerated income tax cuts, a record infrastructure cash splash and help specifically for women will be revealed in the most important Federal Budget since World War II.
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Billions of dollars in tax cuts, a record infrastructure cash splash and help specifically for women will be revealed next week in the most important Federal Budget since World War II.
In an exclusive interview with The Advertiser ahead of handing down Tuesday’s budget, Treasurer Josh Frydenberg outlined key measures to be unveiled in order for the country to “move to the next phase of the economic recovery”.
The next economic support measures to replace the $101bn JobKeeper scheme, which ends in March, will also be unveiled.
“This budget is all about jobs, it’s all about rebuilding the economy from the shock, and it’s all about securing the future,” Mr Frydenberg said.
He confirmed the government would be “extending” its $100bn ten-year infrastructure plan. South Australia is tipped to get a major funding boost for shovel-ready infrastructure projects that can get underway quickly and create thousands of jobs.
Infrastructure SA chief executive Jeremy Conway said a “significant increase” in funding for roads, schools or hospital maintenance would create jobs for SA.
“That’s the sort of work that you can start very quickly. It’s very trade and job heavy,” he said.
SA may also get funding for water or energy infrastructure.
Treasurer Rob Lucas expected the Commonwealth to inject funding into “small or medium sized projects” that would create jobs quickly, such as road upgrades or sealing more of the Strzelecki Track.
“You’ve got to have projects which you can get out and do straightaway,” he said.
SA’s GST share is likely to fall by more than $1bn in the budget, but Mr Frydenberg was confident it would rebound.
One major aim of the budget will be to prevent “labour market scarring” for a generation of young workers.
“If young people are out of the workforce for a long period of time, it can be really hard to get back,” Mr Frydenberg said.
“That’s why the Budget is focused on using our tax system to support families, using our tax system to support investment, using opportunities to re-skill and to retrain, to bring forward infrastructure spending to support young people into work and women into work.”
Asked if there would be measures specifically to help women, he said: “Yes”.
The JobSeeker coronavirus supplement, worth $250-a-fortnight on top of welfare payments, may be extended beyond December 31.
JobKeeper payments will end in March, but the Treasurer hinted at new measures.
“What you will see in the budget is the transition to the next phase of the economic recovery,” he said.
Tax cuts already legislated for 2022 are expected to brought forward, which will lift the top threshold for those in the 19 per cent tax bracket from $37,000 to $45,000, and from $90,000 to $120,000 for those in the 37 per cent bracket.
Unemployment will rise higher than its current 6.8 per cent before December, but won’t be as high as the 10 per cent forecast by the Department of Treasury in July. Mr Frydenberg stopped short of saying Australia would need a baby boom to bounce back from COVID-19, given the nation’s population growth is expected to drop its lowest since 1917.
In July, he joked he wouldn’t go as far as Peter Costello’s infamous quote: “Have one for mum, one for dad and one for the country.”
Yesterday, he said: “I’d be the first to encourage more children in the world.”
“One of the reasons I’m so inspired to do what I do is I’ve got two children of my own, and I’m determined to help make this country an even better place for them.”