THE BASICS:
Treasurer Wayne Swan has produced a budget he says will raises a $21.7 billion surplus. He says it is the largest surplus (as a share of GDP) for nearly 10 years.
The Government plans to slash $7 billion from its 2008-2009 budget, with the biggest cuts coming from “middle class welfare” and the $1 billion OPEL broadband proposal. The Treasurer also plans to slash $33 billion from overall spending over the next four years.
New spending will also be matched by cuts.
There’s no likely interest rate relief for families struggling with mortgages, with inflation set to remain above 3 per cent.
Nevertheless, Mr Swan has framed the budget as one that “delivers for working families under pressure”.
TAXES:
Tax cuts worth $47 billion over four years fulfil the Rudd Government’s election promise, but there were no major superannuation announcements as tipped by some commentators.
Among the highlights:
THE baby bonus and Family Tax benefit B will be scrapped for families earning more than $150,000;
THE average worker earning $48,000 will get a weekly $20 tax cut;
WORKERS earning less than $14,000 will pay no tax;
THE 30 per cent income tax threshold will be lifted from $30,000 to $34,000 and the low income tax offset rises from $750 to $1200;
THE Medicare surcharge threshold will rise from $50,000 to $100,000 for individuals and rise from $100,000 to $150,000 for couples; and,
LUXURY car taxes will rise from 25-33 per cent.
HOUSING:
Rudd has announced a $2.2 billion housing affordability package, which includes:
A FIRST home buyers savings accounts attracting 17 per cent bonus interest on the first $5000, taxed at 15 per cent. Withdrawals will be tax-free if used to buy a first home. The Government predicts the measure will raise home savings by $2.5 billion to $6.5 billion.
A $500 million housing affordability fund will provide infrastructure for new housing and speed up planning approvals.
INCENTIVES will be handed out to encourage investors to build low-cost housing.
TRANSPORT:
The Rudd Government promises to speed up the construction of $560 million of projects:
IN VICTORIA this includes improvements to the West Gate Bridge and Geelong Ring Rd extension, with $51 million brought forward in this state.
A TOTAL of $497 million of the $3.2 billion nationally has been allocated to Victoria.
INFRASTRUCTURE:
THE $20 billion Building Australia Fund will pay for roads, rail ports and broadband. Another $11 billion will go to fund education projects and $10 billion will be allocated to the health and hospital system.
BUSINESS:
Tax breaks on company meals, and private-use laptops and other perks will be scrapped, with other exemptions also targeted in the Fringe Tax Benefits system.
DEFENCE:
THE Government has clawed back $1.2 billion in this year’s budget as a result of failed defence projects, but has also promised to increase the overall defence budget by $2.8 billion to the year 2019.
EDUCATION:
AN EDUCATION Tax Refund worth $4.4 billion will help parents buy children’s school books and laptops. This will be means-tested.
A $2.5 BILLION fund will be established to pay for specialist trade schools
$557 MILLION will go towards improving literacy and numeracy.
HIGHER EDUCATION:
ANOTHER $6 billion will be allocated to an education investment fund to cover the cost of upgrading buildings, research. Full-fee universities places will begin to be phased out.
BROADBAND:
THE Government has allocated $4.7 billion for a National Broadband Network to roll out high-speed broadband to 98 per cent of Australian households and businesses, but also plans to scrap the controversial $1 billion OPEL network.
HEALTH:
THE Government plans a $10 billion fund to cover the future costs of hospitals, Medicare research and new technologies;
$3.2 BILLION has been set aside over four years to cut waiting lists, reduce dental waiting lists for teenagers ($491 million) and tackle State/Federal funding issues.
OTHER spending includes $275 million for GP Super Clinics, a $249 million cancer plan and a national binge drinking strategy;
THE Medicare surcharge threshold will rise from $50,000 to $100,000 for individuals and rise from $100,000 to $150,000 for couples;
FAMILIES:
THE Baby Bonus will be cut to families earning more than $150,000, while the Family Tax Benefit B will also be means tested at $150,000. The cut will save nearly $400 million over four years.
FAMILIES on more than $150,000 will also miss out on the fortnightly Child Care Benefit, and the Dependent Spouse tax offset.
THE child care tax rebate will be lifted from 30 to 50 per cent at a cost of $1.6 billion
FOREIGN AID:
WILL be boosted by $500 million to $3.7 billion, including $200 million to UN agencies, $300 million for clean water and $150 million for climate change projects.
ENVIRONMENT:
INTEREST-free loans of up to $10,000 will be provided to families who make their homes more environmentally-friendly, in a $3 billion proposal covering solar panels, rainwater tanks, greywater recycling, insulation, shading, solar and gas hot water and energy-efficient lighting.
THE Government will spend $2.3 billion over five years to tackle climate change’ The $12.9 billion water plan over 10 years and $2.2 billion plan to protect natural resources have previously been announced.
RURAL:
DROUGHT-hit farmers will keep current assistance levels, with $760 million allocated next year. Another $130 million will be spend on educating farmers on the effects of climate change.
YOUTH:
A NATIONAL youth forum will be established.
$15 MILLION will be spent on boosting cyber safety for young people.
SENIORS:
AN ANNUAL eligibility review could see 20,000 seniors card holders lose benefits.
CONCESSIONS for electricity, water and phone bills will be increased, with the Government spending $2.4 billion in 2007-08 to support older Australians and carers with household bills.
COST OF LIVING:
THE Government will introduce a National FuelWatch Scheme, grocery price monitoring and financial counselling services to ease cost of living pressures
Source: http://www.news.com.au/heraldsun/story/0,21985,23693631-661,00.html
