Federal Budget 2018: Treasurer Scott Morrison to announce a small surplus for 2019
THE Budget will return to the black a year earlier than expected as Scott Morrison celebrates his third year as Treasurer by giving immediate tax relief to middle and low-income earners. The Daily Telegraph can exclusively reveal the size of the tax relief.
NSW
Don't miss out on the headlines from NSW. Followed categories will be added to My News.
AUSTRALIA’S budget will return to the black a year early as Scott Morrison celebrates his third year as Treasurer by giving immediate tax relief of $520 a year to middle and low-income earners.
The Daily Telegraph can exclusively reveal the size of the tax relief will help people purchase the equivalent of a washing machine or pay for their car registration, and will equate to around $10 a week.
And in his Budget speech tonight, Mr Morrison will speak about empowering older Australians and returning to them the choice for how long they choose to work, retire and age.
There will be up to $5 billion in incentives to re-skill seniors later in their career to help them stay in the workforce, along with an extra 20,000 new “home-care packages” so that people can age in their homes for longer instead of moving into a retirement home.
There will also be hip-pocket relief for Baby Boomers and pensioners, in stark contrast to Labor’s plan to axe tax refunds on share investments.
In a federal Budget designed to show both fiscal responsibility and also reinforce traditional Liberal commitments to small government, Mr Morrison is expected to declare a wafer-thin surplus next year — for the first time since Wayne Swan plunged the nation deep into the red.
Prime Minister Malcolm Turnbull, who first flagged income tax cuts six months ago, said yesterday it would be “a Budget that will ensure hardworking Australians can keep more of the money that they earn”.
But in an interview with the Telegraph, Mr Morrison said the generosity of the tax cuts would be tempered by the need to return the budget back to surplus.
“It is targeted and it is intended to provide that relief. You can’t accuse it of being irresponsible if it’s also accused of being too modest. It will be responsible,” he said. “What we will do in the Budget will be responsible and it will be affordable and it will be as much as we can actually responsibly do to take the pressure off lower- and middle-income families.”
Mr Morrison rejected suggestions Australians could be disappointed with the size of the tax relief.
“I think the Prime Minister and I have always been very clear that this had to be delivered in a way that was responsible and consistent with bringing the budget back into balance and we’ve always set those out as the clear conditions on what could be done,” he said. “But what it says is, we will not tax you any more than we have to.”
Mr Morrison confirmed the economy had “strengthened” since he last forecast a slim surplus for 2020-21, indicating it could return to balance faster than expected.
MORE
FEDERAL BUDGET 2018: Research, development tax rorts targeted
FEDERAL BUDGET 2018: What we know so far
FEDERAL BUDGET 2018: NSW loses out to Victoria
But the earlier surplus, in 2019-20, is expected to be slim and conservative; less than $5 billion. “More specifically, on the path back to surplus, to bring the budget back into balance, for five successive statements now, and it will be true in the sixth, we’ve been very clear about bringing the budget back into balance by 2021,” he said.
“Now, we stuck to that. It hasn’t moved. If anything it strengthened over that period of time and we’ve been very cautious and conservative when it comes to our forecasts.
“We haven’t gone out there and spent money we don’t have, like Wayne Swan used to do. We’ve been very careful about that. And so at each Budget update people have seen under the Prime Minister and I continuous improvement, a clear plan, sticking to that plan and getting the results at every statement.”
MORE
FEDERAL BUDGET 2018: Return to surplus by 2019-2020
FEDERAL BUDGET 2018: Mathias Cormann on tax cuts
FEDERAL BUDGET 2018: Treasurer Scott Morrison ‘no Grinch’
The last time the budget recorded a surplus was in 2007, the last year of the Howard government, when it was $19.8 billion in the black.
Mr Morrison will use extra revenue from business taxes, higher commodity prices and getting more people off welfare and paying taxes to not only speed the budget back into the black but to reward hardworking Australians with tax cuts, and promise more for higher-income earners in the medium term.
Tonight’s 2018 budget will also focus on older Australians, with changes to reward retirees, encourage ageing Baby Boomers to stay in their homes longer and connect isolated seniors with their community, particularly after a spouse has passed away.
There will be a multi-billion dollar ageing package — that could be as high as $5 billion — in both the employment and health space to empower senior Australians with choices for their retirement and protect their dignity in their healthcare options.
There will be measures for Australians over 65 and also over 85.
For the older age group, The Daily Telegraph can reveal there will be an extra 20,000 new home-care packages, making a dent on the 100,000 seniors on the waiting list.
This supports people to live at home longer with the Government funding treatment for doctors, physios and other healthcare professionals to visit them in their home, so they do not need to move into an aged-care facility.
There will also In addition to this, there will also be thousands of new residential aged-care places.
New programs will help connect older Australians back into the community, to sporting or social organisations to stop social isolation, particularly when a husband or wife has passed away.
For the younger, plus 65 age bracket, there will be a focus on re-skilling them to enable them to stay in the workforce longer or even start up their own businesses.
There is also expected to be hip-pocket relief for retirees and pensioners.
This is politically designed to win back retirees to the Coalition at a time when Labor leader Bill Shorten is planning to hit them with a tax on their savings through imputation dividend reform.