AUSTRALIA – POLITICS AND GOVERNMENT

‘Big-bang’ tax reform gone

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Original article by David Crowe
The Australian – Page: 1 & 4 : 12-Feb-16

The Australian Government has abandoned plans for large-scale tax reform underpinned by a rise in the GST, although it still wants to reduce personal income tax rates. However, Treasurer Scott Morrison has conceded that tax cuts will have to be much more modest than originally intended. He also said that any reduction in the company tax rate would have to be implemented over several years. Meanwhile, Treasury estimates that economic growth will slow by 0.35 per cent over four years if income taxes are not reduced.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, KPMG AUSTRALIA PTY LTD, AUSTRALIAN LABOR PARTY, BUSINESS COUNCIL OF AUSTRALIA, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, INDEPENDENT ECONOMICS, AUSTRALIA. DEPT OF HUMAN SERVICES

Malcolm in muddle over cabinet reshuffle delay

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Original article by Sid Maher
The Australian – Page: 1 & 6 : 11-Feb-16

The Australian Government is likely to make changes to its frontbench team after Trade Minister Andrew Robb revealed that he will not contest the next election. Robb is likely to remain in Cabinet in the near-term, as he is holding free-trade negotiations. National Party Leader and Deputy Prime Minister Warren Truss also intends to retire, although he is not expected to stand down until Parliament adjourns in mid-March ahead of the May 2016 Budget.

CORPORATES
AUSTRALIA. DEPT OF FOREIGN AFFAIRS AND TRADE, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, NATIONAL PARTY OF AUSTRALIA, AUSTRALIAN LABOR PARTY, LIBERAL PARTY OF AUSTRALIA, AUSTRALIAN FEDERAL POLICE, CHINA NATIONAL METALS AND MINERALS IMPORT EXPORT COMPANY, AUSTRALIAN HUMAN RIGHTS COMMISSION, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY

ALP narrows gap following GST discussions – ALP up 2.5% to 47.5% cf. L-NP down 2.5% to 52.5%

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Original article by Roy Morgan Research
Morgan Poll Update – Page: Online : 9-Feb-16

A multi-mode Morgan Poll on Federal voting intention has found that support for Australia’s ruling Liberal-National Coalition on a two-party preferred basis has fallen by 2.5 per cent to 52.5 per cent. The poll, which was carried out on the weekends of 30-31 January and 6-7 February 2016, also shows that the Coalition’s primary vote is unchanged at 43.5 per cent, while the Roy Morgan Government Confidence Rating has fallen by 0.5 points to 112.5. Roy Morgan Research executive chairman Gary Morgan says that arguing about what sort of taxation reforms the Turnbull Government should undertake such as increasing the GST is pointless as it completely ignores the booming "cash economy", which is especially concentrated in personal services, building and construction, retail and hospitality. Instead of arguing about whether to increase the tax burden on all Australians, the Government should be promoting a significant restructuring of Australia’s costly and restrictive industrial relations laws. The "red tape" that surrounds working conditions in Australia – including high weekend and public holiday penalty rates – discourages businesses from employing more people and contributing to a growing and more productive economy.

CORPORATES
MORGAN POLL, ROY MORGAN RESEARCH LIMITED, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA, AUSTRALIAN LABOR PARTY, AUSTRALIAN GREENS, KATTER’S AUSTRALIAN PARTY, PALMER UNITED PARTY, NICK XENOPHON TEAM, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET

Imputation query as company tax cut gives biggest bang

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 10-Feb-16

Prime Minister Malcolm Turnbull has ruled out increasing the GST to finance income tax cuts, after telling Coalition MPs that economic modelling has shown that it would not be economic feasible. The modelling showed that using a higher GST to finance company tax cuts would achieve the greatest economic benefit. Meanwhile, Australian Industry Group CEO officer Innes Willox has proposed reducing the company tax rate from 30 per cent to 20 per cent by scrapping the dividend imputation system.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, THE AUSTRALIAN INDUSTRY GROUP, AUSTRALIA. DEPT OF THE TREASURY, MACQUARIE UNIVERSITY, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA, AUSTRALIAN LABOR PARTY, COUNCIL OF AUSTRALIAN GOVERNMENTS, NEW SOUTH WALES. DEPT OF PREMIER AND CABINET, NORTHERN TERRITORY. DEPT OF THE CHIEF MINISTER, COUNCIL FOR THE AUSTRALIAN FEDERATION

PM scrambles for a tax policy

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 9-Feb-16

Treasurer Scott Morrison says tax reform will be included in the May 2016 Budget, although the Australian Government has backed down on its proposal to increase the GST. It will instead look at options such changes to superannuation tax concessions and reducing income tax rates via the abolition of tax deductions for work-related expenses. However, Morrison has ruled out making any changes to the negative gearing regime.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF FINANCE, AUSTRALIAN LABOR PARTY, AUSTRALIAN TAXATION OFFICE

Infrastructure financial backing falls by $16b

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Original article by Jacob Greber
The Australian Financial Review – Page: 6 : 8-Feb-16

The "asset recycling program" that was announced in the Australian Government’s May 2014 Budget was expected to generate $A126.3bn worth of infrastructure investment by the states and the private sector. However, new figures show that this estimate has been scaled back to $A110bn. The Federal Government’s original proposal to invest $A50bn on infrastructure projects has in turn been reduced by $A1.4bn.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN BUREAU OF STATISTICS, AUSTRALIAN LABOR PARTY, AUSTRALIAN NATIONAL UNIVERSITY. CRAWFORD SCHOOL OF ECONOMICS AND GOVERNMENT

Tax options shrink after GST retreat

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Original article by David Crowe
The Australian – Page: 1 & 4 : 8-Feb-16

The Australian Government may be reconsidering its plans to increase the GST, after Prime Minister Malcolm Turnbull suggested that there may be no net benefit from increasing the tax and cutting personal income tax rates. The Government is expected to look at alternatives such as changes to the negative gearing regime for property investors. However, Business Council of Australia CEO Jennifer Westacott says her organisation’s modelling shows that a GST increase that is offset by income tax cuts would be the best to boost the economy.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, BUSINESS COUNCIL OF AUSTRALIA, THE AUSTRALIA INSTITUTE LIMITED, UNIVERSITY OF CANBERRA. NATIONAL CENTRE FOR SOCIAL AND ECONOMIC MODELLING, AUSTRALIA. DEPT OF THE TREASURY

Fifield building support for reform

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Original article by Max Mason
The Australian Financial Review – Page: 29 : 8-Feb-16

Communications Minister Mitch Fifield is said to be hoping to introduce cross-media ownership reforms to Parliament in March 2016, ahead of the Budget in May. Fifield has held meetings with the crossbench senators and is optimistic that they will support his push to scrap the "reach rule" and the " two-out-of-three rule". However, any reduction in TV broadcasting licence fees and changes to the anti-siphoning list for sports events are likely to be included in the Budget.

CORPORATES
AUSTRALIA. DEPT OF COMMUNICATIONS AND THE ARTS, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, NATIONAL PARTY OF AUSTRALIA

Government losing appetite for GST hike

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Original article by Phillip Coorey, Primrose Riordan
The Australian Financial Review – Page: 3 : 5-Feb-16

Prime Minister Malcolm Turnbull says a push to increase the GST will only proceed if it can be demonstrated to have positive economic effects, such as creating jobs and lifting productivity. Meanwhile, a growing number of Federal Government MPs and senators have reservations about increasing the GST. Liberal Senator Cory Bernardi has vowed to vote against the Government on any bill to increase the tax, while MP Russell Broadbent says the Government has not presented a compelling case for a tax increase.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Don’t touch negative gearing, MPs warned

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Original article by Phillip Coorey
The Australian Financial Review – Page: 4 : 5-Feb-16

The Property Council of Australia stresses the importance of negative gearing for housing. It will argue in a submission to the joint standing committee on economics’ inquiry into tax deductibility that negative gearing should be retained in its current form. The Property Council has warned that it could mobilise negatively geared voters in marginal seats to persuade politicians to leave negative gearing unchanged.

CORPORATES
PROPERTY COUNCIL OF AUSTRALIA LIMITED, AUSTRALIAN LABOR PARTY