Mathias Cormann confirms economic acceleration as tax revenue grows

Mon, 03 Mar 2014  |  

The Australia economy is significantly stronger than was forecast at the time of the release of the Mid-Year Economic and Fiscal Outlook in late December.

So says Finance Minister Mathias Cormann.

The Government Monthly Financial Statement for the six months to December, shows that tax revenue is flowing in to the government coffers at a 1.1 per cent faster pace ($1.754 billion in six months) than was forecast at MYEFO.

Encouragingly, the increase is quite broadly based.

Income tax receipts are running 0.7 per cent higher than assumed at MYEFO. This suggests the ABS employment and wages data may be overstating the softness of labour market conditions because income tax is a function of the number of people in paid employment and the wages they are paid. Strong jobs growth and higher wages equals more income tax collections for the government and vice versa.

Consistent with the solid corporate reporting season, company tax receipts are running a hefty 3.3 per cent above the rate assumed at MYEFO. This is a good sign of the underlying strength in corporate Australia.

GST receipts are running 0.4 per cent below the MYEFO forecast but excise and customs duty are both a touch stronger. Perhaps the Treasury forecasts for household consumption growth were close to the mark as these up and downs cancel each other out.

There are a few other bits and bobs on the government revenue side presented by Mr Cormann that are tracking a bit higher or lower than forecast in MYEFO, but they are small beer. In the end, if either employment or wages are stronger than forecast in MYEFO, with a solid lift in company tax payments while GST revenues and other duties are more or less on track, it signals the economy chugging along at a more rapid pace than assumed in the MYEFO.

In other words, the economy is doing well and the efforts of Treasurer Hockey to brow beat Treasury into producing overly pessimistic forecasts in MYEFO is already yielding political gains for the government.

Even without a brass razoo impact on the budget from a change in policy or cuts in government spending, the fact the economy is tracking more favourably than assumed in MYEFO means that the deficit in 2013-14 and beyond will be smaller than assumed.

This will be the foundation for the Coalition's 2016 election strategy – fixing the budget even though most people know there was nothing wrong with it to start with.


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Wed, 29 Jul 2020



Covid19 has opened a door for Australians to positively accept significant changes that will lead to a shared good. This rare opportunity enables us to achieve sustainable economic and social goals that create a new ‘normal’ as our way of life.

These Ten Steps are presented as non-partisan recommendations to the Australian Parliament in the firm belief that, if they embrace them, the Australian economy and society will be greatly enhanced after the Covid19 pandemic has passed.

*A job for you if you want one.
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*You will get wage increases that will be greater than your cost of living.
A demand for enhanced innovative skills at all levels of employment will be created as the economy grows in strength, thereby enhancing your stature in the workforce and enabling executive salaries and bonuses to drop to levels that are accepted as justifiable by employees, shareholders and customers.

The misplaced objective of the government of delivering a surplus, come hell or high water, has gone up in smoke

Tue, 07 Jan 2020

This article first appeared on the Yahoo Finance web site at this link:   


The misplaced objective of the government of delivering a surplus, come hell or high water, has gone up in smoke

For many people, the cost of the fires is immeasurable. 

Or irrelevant. 

They have lost loved ones, precious possessions, businesses and dreams and for these people, what lies ahead is bleak.

Life has changed forever.

As the fires continue to ravage through huge tracts of land, destroying yet more houses, more property, incinerating livestock herds, hundreds of millions of wildlife, birds and burning millions of hectares of forests, it is important to think about the plans for what lies ahead.

The rebuilding task will be huge.

Several thousands of houses, commercial buildings and infrastructure will require billions of dollars and thousands of workers to rebuild. Then there are the furniture and fittings for these buildings – carpets, fridges, washing machines, clothes, lounges, dining tables, TVs and the like will be purchased to restock.

Then there are the thousands of cars and other machinery and equipment that will need to be replaced.