The Government has pledged funding across a broad range of areas in its 2011 budget, while maintaining that Australia will be back in surplus by 2012-13.
Delivering the budget to Parliament tonight, treasurer Wayne Swan says the overall deficit will be $22.6 billion in 2011-12, with a surplus of $3.5 billion in 2012-13.
In what was widely billed as a ‘tough’ budget, Swan says that $22 billion in “difficult” savings will be made over the next four years, including $26.4 million in savings from reform of fringe benefits tax.
In his budget speech that points to the challenges posed by the “Asian century” and the recent natural disasters in Australia, Swan says the Government will meet its promise of getting the budget back in the black in two years’ time.
“We’ll be back in the black by 2012-13, on time, as promised. The alternative – meandering back to surplus – would compound the pressures in our economy and push up the cost of living for pensioners and working people,” Swan says.
“We will reach surplus despite company taxes not recovering like our economy.”
In a wide-ranging budget, there are several announcements that will be of interest to entrepreneurs.
The key points of Swan’s budget are:
As expected, the Entrepreneurs’ Tax Offset has been scrapped, with the introduction of a $5,000 tax write-off for small business’ vehicles.
The car fringe benefits tax will be overhauled to remove the incentive for people to drive their car further to gain a larger tax concession. A single statutory rate of 20% will be introduced, saving the Government $953 million.
The excess contribution regime has been altered so that those who breach the cap by up to $10,000 can request for these contributions to be refunded to them and will not face big penalties.
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The Small Business Support Line will get an extra $7.1 million in funding over the next four years.
A $34.4 million “Buy Australia” initiative will aim to boost Australia’s manufacturers by helping them compete in the global market, particularly for resources projects.
There is $3 billion over the next six years that has been committed to boost skills in Australia’s workforce. A new National Workforce Development Fund will be launched, 130,000 training places will be created and there are new incentives to encourage single mothers and the long-term unemployed into work.
There will be a $100 million funding boost for an apprenticeship mentoring scheme, while $1.75 billion will be given to the states and territories to expand vocational education and training.
The CSIRO will get an additional $3 billion in funding over four years to further scientific research, with $20 million of this used to extend the Tasmanian ICT Centre.
An extra $954.3 million in funding has been allocated to the Nation Building Program, with work planned on new road, rail and public transport projects.
Initiatives costing $4.3 billion will commence on July 1 to boost regional Australia, including upgrades to hospitals, universities and training.
A “measured” increase in permanent migration will see 185,000 visas issued in 2011-12, up from 180,000 last year.
A $100 million initiative dubbed Suburban Jobs will aim to drive more employment opportunities in the fringes of Australia’s cities.
Australia’s film and TV industry has been handed an extra $56 million in funding, while young artists will be supported by a new $10 million fund.
For the first time, a statutory definition of ‘charity’ has been introduced by the Government. The budget also includes measures to reduce red tape for the not-for-profit sector.