The 2016-17 Budget is an economic plan for Australia. It is a plan for a strong new economy with more jobs and growth.
As Australia successfully transitions from the mining investment boom to a stronger, more diversified economy, it is vital that our tax system drives economic growth and national prosperity.
These measures will encourage workforce participation and business investment to improve growth and create the jobs of the future.
Highlights of the Budget include:
• Small businesses – from 1 July this year, small and medium businesses with annual turnover less than $10 million will have their company tax rate cut to 27.5 per cent.
• The new Youth Employment Package – $840.3 million over four years to assist up to 120,000 vulnerable young people take advantage of job opportunities
• Monash Freeway upgrade – $1 billion
• Melbourne Metro Rail tunnel – $850 million
• Continuation of the Government’s $50 billion infrastructure program
Our tax plan backs hard-working Australians. It will also drive jobs and growth across the country, with real benefits for individuals and businesses in the electorate.
Middle income Australians are bearing a growing tax burden. The Government will increase the middle tax bracket threshold from $80,000 to $87,000 from 1 July 2016.
The Government will also introduce a Low Income Superannuation Tax Offset from 1 July 2017. This will ensure that low income earners are not paying more tax on their superannuation than they are on their take-home pay.
This means 23,943 individuals in Flinders earning $37,000 per year or less will effectively pay no tax on the money they contribute to superannuation.
Locally, residents will benefit from the Black Spot Program to improve dangerous roads and intersections.
Local councils will receive significant funding from the Roads to Recovery Program to upgrade and improve local roads. In 2016-17 councils will receive more than $9.3 million across the Flinders electorate.
Funding under the Roads to Recovery Program includes:
• Bass Coast Shire Council – $1.5 million
• Cardinia Shire Council – $2.7 million
• Casey City Council – $2.4 million
• Mornington Peninsula Shire Council – $2.6 million
• French Island – $43,700
Local governments will also receive $2.3 billion in funding under the Financial Assistance Grant program in 2016-17. These grants are untied, allowing councils to spend the grants according to local priorities.
The Turnbull Government is also investing $1 billion in the Monash Freeway upgrade and more than $850 million to the Melbourne Metro Rail tunnel as well as injecting funding into regional roads and urban congestion projects.
As we transition from the mining investment boom it is vital that we give Australian businesses every opportunity to invest, grow and employ more Australians.
To make it easier for these businesses to expand and create more jobs, the company tax rate will be cut, with small and medium businesses benefitting first.
From 1 July this year, small and medium businesses with annual turnover less than $10 million will have their company tax rate cut to 27.5 per cent. This will reduce the tax rate for around 4,851 companies in Flinders.
Since many small businesses are not companies, from 1 July 2016, the Government will also increase the unincorporated small business tax discount to 8 per cent and extend the threshold from a turnover of $2 million to $5 million.
Small businesses are the engine room of our local economy and the backbone of our local community. These tax cuts will provide a significant benefit to our local businesses and help drive jobs and growth in our local economy.
More than 90 per cent of pensioners will be either better off or have no change to their pension. Those most affected pensioners will only have to draw down a maximum of 1.8 per cent of their assets to make up for the loss of their part pension.
We’re doing this through two main changes to the assets test: increasing the assets people are able to own before it affects their pension and increasing the taper rate at which the pension reduces once their savings and assets go over the free area.
About 171, 500 Australians with modest assets will receive an extra $30 per fortnight on average, including 50,000 part pensioners who will qualify for a full pension.
The Turnbull Government’s investment in education, training and child care will increase to more than $41.8 billion in 2016-17. This includes:
• $8.6 billion for early education and care – a 9.6 per cent increase
• $17.6 billion for schools – an 8 per cent increase
• $12.3 billion for higher education – a 0.9 per cent increase
• $3.3 billion for skills – a 7.7 per cent increase
A well-educated nation will increase productivity, drive innovation and support our transition to a stronger and more diversified economy.
The Government will also invest $840.3 million over four years in a Youth Employment Package to assist up to 120,000 vulnerable young people take advantage of job opportunities as the economy diversifies and transitions to broader-based growth.
The new Youth Employment Package builds on initiatives introduced by the Government last year to help support youth employment.
In the last 18 months, 50,000 more young Australians have found jobs, but there is more work to be done.
At the core of the package is the Youth Jobs PaTH (Prepare-Trial-Hire), a $751.7 million initiative to help maximise the chances of job seekers under 25 getting a job.
Communities will also benefit from the Government’s $1 billion National Stronger Regions Fund, which promotes capital infrastructure projects in regional areas.
We are also committed to preserving our natural environment for future generations and are doing more than ever before to protect the Great Barrier Reef.
The 2016-17 Budget commits $171 million boost to protect and preserve the Reef.
Included in this is a $70 million additional injection to the Reef Trust – bringing the Government’s total investment in the Reef Trust to $210 million, along with an additional $100 million for investment into reef water quality.
The Turnbull Government understands the economic challenges that Australia faces, which is why we have a strong plan to keep spending under control while guaranteeing support for vital services such as hospitals and schools.
This is the right plan for Australia to overcome the challenges of the economic transition and to clear a path for long-term growth and jobs in a stronger, new economy.
More details on the Budget are available at www.budget.gov.au