The Treasurer on Mon 15.12.2014, released the 2014-15 Mid-Year Economic and Fiscal Outlook (MYEFO).
He said that, as a result of recent events, such as the halving of the export price for iron ore and the fall in wheat prices, tax receipts are expected to fall by $6.2bn this year and a total of nearly $32bn over the next 4 years.
Mr Hockey said company tax receipts are expected to be $2.3bn less this year (id=”mce_marker”4.4bn over 4 years), and income tax is expected to be $2.3bn less this year ($8.6bn over 4 years). “To try and recover these falling revenues now, through new or higher taxes would unquestionably harm the Australian economy”, the Treasurer said.
Means tested payments such as Family Tax Benefits ($3.2bn) and income support payments (id=”mce_marker”bn) have had larger than expected increases as families remain in lower income thresholds and therefore claim more benefits. Child care payments ($2.4bn) have also increased on the back of more parents looking to participate in the workforce.
The Treasurer said the Government will announce a comprehensive families’ package in the new year, including child care and parenting leave initiatives. This package will deliver greater work participation opportunities for parents, Mr Hockey said.
The failure of the Senate to accept all the Government’s policies has cost the Budget id=”mce_marker”0.6bn, the Treasurer said. There is a further $34bn still to be legislated including $5bn of savings announced by the previous Government.