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The Albanese Government will hand down the updated 2022-23 Federal Budget on Tuesday 25 October 2022.
How will this Budget impact Australia’s economic resilience and solve the inflation, growth, and jobs challenges? SUBSCRIBE to our REPORT > or REGISTER for our WEBINAR >.
In our last tax insights email we asked our clients the question, “What area should the Federal Government be focusing on in the October 2022 Federal Budget?”.
Some thoughts from our TAX TEAM:
RBA cash rate at a nine year high.
This is obviously adverse for home mortgage holders, but few consider the material impact on the national interest bill (i.e., higher interest payments on government bonds), and in turn the upcoming Budget (i.e., less money to spend).
Headline rate of inflation currently exceeds double the RBA’s target of 2-3%, which unavoidably gives rise to cost-of-living pressures, compounded by the abovementioned interest rates.
Treasurer Chalmers has announced relief of cost-of-living pressure as the government’s priority. However, no relevant measures have yet been announced, and the government seems to be downplaying the prospect of any significant announcements in the current environment. It will be very difficult for the government to manoeuvre in the context of such a high level of national debt relative to GDP.
SMEs are in a difficult position, contending equally with the foregoing pressures.
Small Business Skills and Training Boost are very welcome, but unlikely to materially benefit SMEs.
The government appears to be constrained, in this regard, by the current national deficit. Although Potential ideas to provide relief to SMEs include extending the TFE rules (currently ceasing effective 30 June 2023), the inflationary impact hereof warrants consideration.
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Our Federal Budget Insights will analyse the new Labor Government's economic responses to recent challenges. What does this mean for the economy, our society and you?
