The Federal Government’s Mid-Year Economic and Fiscal Outlook is all about Treasurer Wayne Swan protecting his government’s 2012-13 surplus in the face of sharp falls in revenue.
Swan has unveiled $16.4 billion worth of spending cuts and revenue measures to help produce a budget surplus of just $1.1 billion in 2012-13, down from a forecast of $1.5 billion four years ago.
Business has borne the brunt of some serious cuts and revenue measures. We’ve outlined the top five below:
1. The Australian Taxation Office will raise an extra $1.6 billion over the next four years by targeting “outstanding income tax lodgements in the micro and small business segments” as well as profit shifting and high net worth individuals.
2. The government will move to force larger businesses to make pay-as-you-go tax instalments monthly rather than quarterly in a move that will raise an extra $8.3 billion over the next four years. This will hit companies with turnover of over $1 billion from 1 January 2014, companies with turnover of $100 million or more will be affected from 1 January 2015 while companies with turnover of $20 million or more will have to comply from 1 January 2016.
3. Government to raise $445 million over next four years by closing a loophole that allowed employees to salary sacrifice to buy goods produced by their employer in what where known as “in-house fringe benefits”.
4. The extremely popular Export Market Development Grant has been “re-targeted” to save $100 million over the next four years. A description of the “re-targeting” has not been provided; although the entire program is worth $150 million a year, so a $25 million annual cut represents a big loss.
5. Incentives for employers of part-time and casual workers have been cut, saving $277 million over four years.