# The Budget 2016 - Same old? Or new direction?



## pixel (3 May 2016)

Much hype and expectation on "Budget Eve".
Will Turnbull-Morrison deliver? 
Anybody care to hazard a guess?

I have listened in at tonight's QandA and a few comments touched on early concerns and expectations. "The SINKs and DINKs will have to shoulder the Load", one comment read. That seems to sum it up, if it's true that Business tax rate and top income will indeed be protected.
Given the current composition of the Lib-Nat backbench in particular, I find it difficult to see room for a more socially-conscious new direction. 

Still, I'm prepared to give MT the benefit of the doubt that he may be trying to do what's best for the broad population, not just his Merchant and Banker mates. But the pessimist in me finds himself right more often...


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## pixel (3 May 2016)

Heard in this morning's news that "Economists expect the RBA to drop interest rates mere hours before the Budget is released."
Woweee! Wouldn't that throw the cat among the pigeons! The RBA would in effect say: The Economy is still in a mess. People and businesses need to be persuaded to spend more ... and put it on credit.

Yeah - as if that had worked in Japan and America...


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## CanOz (3 May 2016)

pixel said:


> Heard in this morning's news that "Economists expect the RBA to drop interest rates mere hours before the Budget is released."
> Woweee! Wouldn't that throw the cat among the pigeons! The RBA would in effect say: The Economy is still in a mess. People and businesses need to be persuaded to spend more ... and put it on credit.
> 
> Yeah - as if that had worked in Japan and America...




This was pretty much expected since the release of the inflation data...The bonds are holding their bid, so certainly an expectation still there too...will be an interesting release this time around for sure. A surprise should see a dramatic swing in the currency, binds and equities, perhaps either way we'll get a wild swing. Oh, Chinese manufacturing PMI out this AM as well.


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## Craton (3 May 2016)

A rate cut before the Budget is rolled out seems a bit premature to me.

On an environment note and as the water from my tap tastes like mud and fish poo at the minute, am really interested in the Govt. decision to tackle the carp biomass. A female carp can lay/bred a million fishlings per year! With no natural predators here and the fact that carp don't play nice with our native species, this pestilence needs to be eradicated ASAP. This will go a long way in helping the Murray/Darling basin.

Am in no delusion, Malcolm and crew will have election sweetners for sure and I'd expect, economic kick starters.


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## CanOz (3 May 2016)

Craton said:


> On an environment note and as the water from my tap tastes like mud and fish poo at the minute, am really interested in the Govt. decision to tackle the carp biomass. A female carp can lay/bred a million fishlings per year! With no natural predators here and the fact that carp don't play nice with our native species, this pestilence needs to be eradicated ASAP. This will go a long way in helping the Murray/Darling basin.
> 
> Am in no delusion, Malcolm and crew will have election sweetners for sure and I'd expect, economic kick starters.




Figure out how to export live carp to China and you'll make millions!


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## Craton (3 May 2016)

CanOz said:


> Figure out how to export live carp to China and you'll make millions!




That's is not a bad idea.


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## CanOz (3 May 2016)

Craton said:


> That's is not a bad idea.




You figure out how to catch and ship them, we'll figure out how to get them in.


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## CanOz (3 May 2016)

There's the rate cut...25bps


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## pixel (3 May 2016)

CanOz said:


> There's the rate cut...25bps




... and the S&P 200 jumps 50+ because a lot lower yield will be enough to beat the cash rate.
Spend, folks! Consume! Saving is for mugs!


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## pixel (4 May 2016)

Do the numbers stack up?
Who will be providing all those new jobs? What will they be about?
A lot of slogans and unanswered questions.

Is the lack of participation in this thread a sign of general disillusionment?


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## Wysiwyg (4 May 2016)

pixel said:


> Is the lack of participation in this thread a sign of general disillusionment?



The best news for me is the wage bracket raise which comes into effect next FY.

I heard Chris Bowen mention negative gearing during his ABC tv reply. Labor won't win this election because they have nothing economically smarter than Libs. and Libs. have kept any workplace reform off the agenda so far. If people have jobs (or hope of) they are generally happy.


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## Smurf1976 (4 May 2016)

pixel said:


> Is the lack of participation in this thread a sign of general disillusionment?




It seems somewhat of a "nothing" budget to me so there's not a lot to discuss. 

A few adjustments to existing things, or simply continuing with the previous approach, but nothing overly radical or inspiring.


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## Smurf1976 (4 May 2016)

Wysiwyg said:


> If people have jobs (or hope of) they are generally happy.




If people have jobs and unemployment is low then that tends to focus attention other matters and traditionally at least, it's the non-economic things where Labor tends to gain more traction.


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## PZ99 (4 May 2016)

Tax cuts to small business is a winner for me. 

No plans for a budget surplus anytime soon so we spend money on roads and subs... are we at war or something?

Overall a mostly harmless budget not as good as last year but miles better than 2014 

Clicky


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## CanOz (4 May 2016)

PZ99 said:


> Tax cuts to small business is a winner for me.
> 
> No plans for a budget surplus anytime soon so we spend money on roads and subs... are we at war or something?
> 
> ...




I like the tax cuts to small business as well...what's with the definition though, I heard up to ten million then a billion

Up to 100 million in revenue makes sense to me...a billion....hmmmm


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## pixel (4 May 2016)

So it's mostly "Same Old..."
But despite being "same old" myself, I can't help but notice, and be dismayed by, the continued erosion of University funding. Rather than investing in a smarter future, they waste the $Billions we don't have on submarine "Dinosaurs of the Deep" I don't believe we need.

I had also been hoping for a re-allocation of funds from over-funded Private to public schools - even more so as parents are increasingly sending their kids to public schools. 
And then there's the "Chaplain Aid", which in effect diverts much-needed taxpayer funds to religious outfits that are already tax-exempt. (Do Islamic Colleges also have to hire a Chaplain?)


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## PZ99 (4 May 2016)

Just as an aside our net debt is now $326 billion which is near 19% of GDP.

In 2007/08 we had a surplus of $45 billion.

So in the last 9 years Govts have overspent by more than a third of a trillion dollars in an economy that generates $1.7 billion in GDP.


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## Craton (4 May 2016)

pixel said:


> Do the numbers stack up?
> Who will be providing all those new jobs? What will they be about?
> A lot of slogans and unanswered questions.
> 
> Is the lack of participation in this thread a sign of general disillusionment?




No disillusion here. I'd reckon that Aussie's are fairly savvy when it comes to Govt. budgets and are realists to the state of play, so to speak.

Govt dealing with falling revenue/tax receipts compared to Labor's heady years, no huge expectations from this voting tax payer. Budget might be a bit bland but I do expect prudent fiscal management from any incumbent party.

Tax break for small business scaling down to 25% for all businesses by the tenth year, is long overdue as this has been bandied around for as long as I can remember. Should make Australia a lot more attractive to foreign investment. 
As a micro business owner, am keen to learn of the finer details re. employer options for small business as have always tried to give first job seekers a go. Making that more affordable is certainly attractive.

Increasing cigarette excise is a good move, might see a large percentage give up. Side affect that a healthier population will take pressure off the health system in the longer term and put those saved cigarette $'s into the economy, hopefully not into the black market or "alternatives".

Tweaking super tax is a good move because CGT on the PPR and negative gearing has been left alone.

No doubt there's an election war chest stashed away to sweeten us up over the coming months too.


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## CanOz (4 May 2016)

Yeah i agree Craton, i don't think anyone could expect to much more from a party that needs to get elected and stay elected if they're going to try and make a difference to the books. They need to get thier spending cuts past the lawmakers anyway, unless they get the numbers to do that, Australia won't get the bills paid.


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## Ves (4 May 2016)

Craton said:


> Govt dealing with falling revenue/tax receipts compared to Labor's heady years, no huge expectations from this voting tax payer. Budget might be a bit bland but I do expect prudent fiscal management from any incumbent party.




Can you provide the actual figures to show where these overall revenue/tax receipts have fallen?

Because it's my understanding that they actually haven't.


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## qldfrog (4 May 2016)

Ves said:


> Can you provide the actual figures to show where these overall revenue/tax receipts have fallen?
> 
> Because it's my understanding that they actually haven't.



They have at least in my case and drastically.


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## Craton (4 May 2016)

Ves said:


> Can you provide the actual figures to show where these overall revenue/tax receipts have fallen?
> 
> Because it's my understanding that they actually haven't.




In percentage terms but yes, you are correct.

Stats, stats and damn...

http://www.abs.gov.au/ausstats/abs@.nsf/mf/5506.0


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## pixel (5 May 2016)

Winners and Losers
a neat summation to be found here: http://www.abc.net.au/news/2016-05-...udget2016|Outbrain|budget-2016-winners-losers

Winners: 
Small Business
Upper-middle earners
Drivers
Defence
Young Job Seekers (???)
and *The ATO*

Losers: 
Multi-Nationals
Smokers
Working parents
Uni students
Public Service


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## Knobby22 (5 May 2016)

The economics editor for the Age gives the budget the big thumbs up.

"This type of Federal budget is rare. The Turnbull government sought and adopted best practice. You can't argue with that." 

http://www.theage.com.au/comment/fe...at-it-the-better-it-gets-20160504-golu0t.html


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## SmokeyGhost (5 May 2016)

It always seems to be the way with Budgets.  Those who feel they have been short-changed or their "Priority Issues" have not been addressed and accommodated will, and do, complain.  Was just having a read about the outrage from SMSF Association and the SMSF Owners' Alliance about the impact of the proposed superannuation changes.

Yep, situation normal, nothing to see here.  Moving on.


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## pixel (5 May 2016)

SmokeyGhost said:


> It always seems to be the way with Budgets.  Those who feel they have been short-changed or their "Priority Issues" have not been addressed and accommodated will, and do, complain.  Was just having a read about the outrage from SMSF Association and the SMSF Owners' Alliance about the impact of the proposed superannuation changes.
> 
> Yep, situation normal, nothing to see here.  Moving on.




Solar Citizens are also outraged:


> Last night the Turnbull Government did the unthinkable. Confirmed in the Budget, they intend to rip $1 billion from the Australian Renewable Energy Agency (ARENA)*.
> 
> ARENA funding helped build the largest solar PV plants in the Southern Hemisphere at Nyngan and Broken Hill. And there are countless more clean energy projects and technologies that would never have made it to market without grants from ARENA.


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## Knobby22 (5 May 2016)

Why is it that they can't make it to market in economic terms. 
Look at Texas, massive amounts of solar and I don't think they are subsidised.


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## qldfrog (5 May 2016)

Knobby22 said:


> Why is it that they can't make it to market in economic terms.
> Look at Texas, massive amounts of solar and I don't think they are subsidised.



Loans in US at 2%, loans here at 8% spot the difference? 
I might exagerate but that is a key factor in term of ROI


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## luutzu (5 May 2016)

pixel said:


> Winners and Losers
> a neat summation to be found here: http://www.abc.net.au/news/2016-05-...udget2016|Outbrain|budget-2016-winners-losers
> 
> Winners:
> ...




Can't fund Science or Climate change agency; can't afford helping innovation in alternative clean energy; can't help working parents either... So cut and cut.

Can't afford much at the moment, so corporations will have to live with less tax cut, too.

Pretty sure I read it right from Morrison... that while Australian's corporate tax is not yet "globally competitive"... we can't afford it just yet so only 2% this year alright boys?


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## Ves (5 May 2016)

Craton said:


> In percentage terms but yes, you are correct.
> 
> Stats, stats and damn...
> 
> http://www.abs.gov.au/ausstats/abs@.nsf/mf/5506.0




Thanks for the link.   I'm a bit of a numbers guy,   so always nice to see the raw data.


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## Smurf1976 (5 May 2016)

pixel said:


> Drivers




Only those who use certain roads in Vic and SE Qld.

Everyone else seems to gain nothing although we do of course have the re-introduced indexation of fuel excise that came from last year's budget.


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## sptrawler (5 May 2016)

Smurf1976 said:


> Only those who use certain roads in Vic and SE Qld.
> 
> Everyone else seems to gain nothing although we do of course have the re-introduced indexation of fuel excise that came from last year's budget.




Well Smurph, from my recent sojourn to the apple Isle, the last thing Tassie needs is better roads.

I thought they were brilliant, no traffic lights at off ramps and on ramps, flyovers, underpasses magic.

Come to W.A, we have traffic lights at every on and off ramp, every major intersection.

Traffic lights and barriers on every train crossing, including those in the middle of nowhere.

They even put in speed reduction signs on a motorway, at an intersection,  rather than just install an extra lane to enable cars to get up to speed before merging.
That does have the added benefit of being a place to stick a speed camera.lol

I found driving in Tassie an absolute breath of fresh air.


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## Craton (6 May 2016)

Ves said:


> Thanks for the link.   I'm a bit of a numbers guy,   so always nice to see the raw data.




No drama Ves, happy to oblige and that the link proved useful. 

Numbers, where would we be without these little pearls?


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