Road and bridge upgrades slated for Tasmania amid 2020/21 Federal Budget announcements
Almost 1 million jobs and nearly $100 billion in extra measures are set to drive Australia out of recession – and Tassie looks to benefit in some big ways. READ THE FULL BUDGET BREAKDOWN >>
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TAX cuts of up to $5490 for families and $2745 for singles have been unveiled in a historic Federal Budget that splashes $98b of extra measures to drive Australia out of recession and create 950,000 jobs within four years.
About 230,000 Tasmanians will be eligible for tax cuts, while 72,000 Tassie businesses will be eligible for new tax incentives, including a temporary extension of the instant asset write-off that will allow businesses up to $5b to fully write off new assets.
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The state will get a $359m cash injection for infrastructure projects, including the long-awaited Sorell Causeway duplication and the Tasman Bridge upgrade.
It will also share in $2b for ‘shovel-ready’ road safety upgrades across Australia.
Tasmanian’s GST will also grow by $171.3m to $2.4b this year – even though the national GST pool took a multi-billion dollar hit.
The Federal Budget will plunge $213.7b into the red, while Australia’s gross debt will hit $872b this financial year and balloon to $1.13 trillion by 2024.
Treasurer Josh Frydenberg said the debt would be a “heavy burden” for Australians but was necessary to tackle “the greatest challenge of our time”.
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“The Great Depression and two World Wars did not bring Australia to its knees, neither will COVID-19,” he said.
“There remains a monumental task ahead. But there is hope. Australia is up to the task.”
Mr Frydenberg said the Budget would be the start of “the next phase” of recovery from COVID-19.
Families will be able to get tax cuts of up to $5490, while singles will get up to $2745 in a $17.8bn package, which brings forward ‘Stage 2’ tax cuts already scheduled for 2022 and extends a tax offset for low and middle income earners for another year.
‘Stage 2’ tax cuts will be backdated to July 1, and will lift the top threshold for the 19 per cent tax bracket from $37,000 to $45,000, and from $90,000 to $120,000 for the 32.5 per cent tax bracket.
It will mean hip-pocket relief for about 11 million Australians and will pour “billions” back into the economy and create 50,000 new jobs, Mr Frydenberg said.
Pensioners will get two payments of $250 in December and July, after the aged pension was frozen when inflation went backwards, in a $2.6bn package.
A wage subsidy will be launched from today for businesses to hire young workers aged 16 to 35 currently on JobSeeker to work at least 20 hours a week.
Businesses will get $200 a week for people aged under 30, and $100 for those aged 30 to 35 under the $4bn scheme that’s available for one year and is expected to support 450,000 jobs for young people.
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The government will also pay half of the wages for new apprentices and trainees for a year, or up to $7000 a quarter, in a $1.2b package to create 100,000 new apprenticeships.
For businesses, Mr Frydenberg said the instant asset write-off expansion would be a “game changer” that will unlock investment, boost productivity and create “tens of thousands of jobs”.
Businesses will also get temporary loss carry-back measures, which means losses incurred until June 2022 can be offset against profits made in or after 2018-19.
The NDIS will get a $3.9b injection, while $2b will go towards water infrastructure projects such as dams, weirs and pipelines.
The $2b for ‘shovel-ready’ road safety upgrades will come with a “use it or lose it” provision to ensure construction jobs are created quickly.
An extra 10,000 loans for new homes will be made available under a first home buyers’ scheme, which means buyers will only have to save a five per cent deposit.
An extra $1b will go towards low cost finance for community housing providers to boost social housing.
About $240m was set aside for projects specifically to help women, who have been hit hardest by the crisis.
Unemployment will peak at 8 per cent in December quarter – much higher than the Global Financial Crisis but not as bad as the Great Depression – before falling to 6.5 per cent by next June.
It should drop to six per cent in 2022 and to 5.5 per cent by 2024, meaning the Federal Government will begin its strategy to get deficit and debt down within two years.
Australia’s is forecast to be out of its first recession in almost 30 years by 2021, when the economy is tipped to grow by 4.25 per cent.
The economy its tipped to shrink by 3.75 per cent this year.
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