The Turnbull Government is making the right choices to take further action on building a fair and responsible path to a balanced budget, ensuring Australia can secure better days ahead.
Having exhausted every opportunity to secure savings from the 2014-15 Budget to the 2015-16 Budget, the Government has decided to rule a line and reset the Budget by reversing these unlegislated measures.
Despite this, the Budget will return to balance in 2020-21 and remain in surplus over the medium term.
The underlying cash balance will improve from a forecast deficit of $29.4 billion in 2017–18 to a projected surplus of $7.4 billion in 2020–21.
New spending has been fully offset and average real growth in payments has been restricted to less than 2.0 per cent over the forward estimates.
The Government will act to further protect our welfare system for those who need it by strengthening the integrity of the welfare payments. Measures to identify and recover welfare overpayments are expected to return around $4 billion to the Budget in cash terms by 2021, and will help to ensure the sustainability of Australia’s welfare system.
We will support parents of young children to get jobs by expanding the successful ParentsNext programme.
We will introduce a new targeted Job Seeker Compliance Framework to apply stronger financial penalties to persistently non-compliant job seekers. This will ensure those who are able to work do so, and do the right thing by fulfilling their mutual obligation requirements. Work for the Dole will also be refocused towards the most disadvantaged job seekers.
The Budget also continues our strong actions to combat tax avoidance, ensuring multinationals pay their fair share of tax.
The Australian Taxation Office has already raised $2.9 billion in tax liabilities this financial year against a group of seven large multinational companies, and expects to raise more than $4 billion in total this financial year from large public groups and multinationals.
We are toughening the Multinational Anti-Avoidance Law to extend the rules to corporate structures involving foreign partnerships or trusts. We are also clamping down on tax avoidance using hybrids.
We will also be introducing new tax integrity measures as recommended by our Black Economy Taskforce.
And from 1 July 2017, the Government will improve the integrity of negative gearing by disallowing deductions for travel expenses and, for properties bought after today, the Government will also limit plant and equipment depreciation deductions to only those expenses directly incurred by investors.
Since the last election, the Government has legislated around $25 billion in measures to help repair the Budget. This takes to more than $100 billion the budget repair measures implemented since the 2013 election.
Continued action and focus on budget repair demonstrates our commitment to maintaining Australia’s AAA credit rating.
The Turnbull Government’s fair and responsible economic management will ensure we live within our means, making the right choices to secure better days ahead for all Australians.