Unit 7/12 Belgravia Terrace, Rockingham, WA 6168

The Road to Recovery? Federal Budget 2020-2021 Update

The Federal Budget 2020-2021 is a road to recovery paved with cash.

Key initiatives include:

  • Personal income tax cuts from 1 July 2020
  • A $4 billion ‘JobMaker’ Hiring Credit to encourage businesses to take on additional employees aged 16 to 35 years old
  • $110 billion in infrastructure investment over 10 years
  • Immediate deductions for business investment in capital assets
  • Changes to how companies can manage losses
  • Access to generous tax concessions for a wider range of businesses

The Budget also contains two additional Economic Support payments. These are for pensioners and other eligible recipients to drive money back into the economy.

By comparison to many, Australia has managed the COVID-19 pandemic well. However, good management isn’t enough to protect us from the $213.7 billion deficit in 2020-21. The Government has taken to heart the old adage, “You have to spend money to make money” to trade our way out of a black hole.

Some of the measures are aimed at addressing the harsh lessons COVID-19 has taught us. From here we seek to centralise production back in Australia to ensure our industries can be self-reliant.

Outside of the big-ticket tax measures, what is striking about this Budget is the sheer volume of initiatives it funds – too many to itemise in this update. Many of the initiatives aim to improve how Government interacts with the community and business in particular. This funding is focussed on streamlining interaction and compliance with Government requirements and investing in the IT infrastructure required to digitise the compliance process.

The final comments in the Treasurer’s Budget speech paint a cautionary tale. The focus right now is on the path to growth and stabilising debt in an effort to boost consumer and business confidence. However, once “recovery has taken hold and the unemployment rate is on a clear path back to pre-crisis levels” of below 6%, the second phase will kick in – the deliberate shift from providing temporary and targeted support to stabilising debt.

Federal Budget 2020-2021 Update

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Heaney Business Group

Heaney Business Group

Our purpose is to build healthy long-lasting relationships with our clients, staff and within the local community. We work closely with our clients to help them achieve their dreams and goals.

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