The Federal Budget 2015-16 was released on Tuesday night and we have summarised the most important points for you:
One key point of the budget is the tax break for small businesses. There are around 2 million small businesses in Australia. The budget released yesterday revealed a $5.5bn tax break for these businesses, including the right to claim an unlimited number of tax deductions for buying cars and machinery valued at less than $20,000 each. According to some tax experts, as long as the purchase isn’t stock, almost any item can be claimed. Small business tax will also be cut from 30 to 28 per cent, or a discount of up to $1000.
Another key point of the budget is the significant infrastructure funding for Western Australia, Queensland and the Northern Territory. The infrastructure budget includes: $5bn for ports, rails, pipes and power stations. $3bn set aside for Melbourne’s East-West Link. $5.6bn for the Pacific Highway duplication in NSW. $2.9bn for the Western Australia Infrastructure plan. $6.7bn to upgrade the Bruce Highway. $925m for the Perth Freight Link. $500m for the Darlington Interchange, and $400m for the Midland Highway. There is also a small provision named the Strong Communities fund. It will allocate around $150,000 for each electorate for small and local infrastructure projects.
The aggregate deficit over the four-year forward estimates period is $82.2bn. Net debt is projected to be $286bn, or 17.3 per cent of Gross Domestic Product (GDP). The budget details $429.8bn in expenditures and $398bn in receipts. Other provisions in the budget include benefits for younger working individuals. The young and unemployed will only have to wait four weeks instead of six months to access the dole. Individuals between the age of 22 and 24 will have access to higher Newstart payments until June 2016. Individuals who are over 50 and seeking employment will receive up to $10,000 over 12 months, up from the 2 year period previously. $327.7m in additional funds has been allotted for disadvantaged families. The Great Barrier Reef will also receive an extra $100m over the next four years.
Author: Imran Valibhoy
May 13, 2015
Since Joining the firm in 2006, Imran has worked on a range of M&A and Capital Market transactions in the natural resources, mining as well as projects in the renewable energy sector. Prior to joining Wise-owl, Imran worked at Euroz Securities in Perth, aiding in the advisory and valuation of companies in the mining and industrial sectors in Australia. Imran has a Masters in Banking & Finance from City University's Class Business School in London and a Bacheloor degree in Commerce from UWA.