BUDGET – AUSTRALIA

Rates cut, fiscal plan keep real estate ticking

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Original article by Michael Bleby
The Australian Financial Review – Page: 6 : 5-May-16

Angus Raine, the executive chairman of Raine & Horne, says the Reserve Bank’s move to reduce the cash rate to 1.75 per cent should attract first-time buyers back to the property market. Most experts do not expect the rate cut and the Australian Government’s May 2016 Budget to have much impact on activity in the residential market, but some suggest that the new rules on superannuation fund balance transfers will prompt increased demand for lower-priced commercial properties.

CORPORATES
RAINE AND HORNE PTY LTD, RESERVE BANK OF AUSTRALIA, CBRE PTY LTD, CENTURY 21 REAL ESTATE, RAY WHITE REAL ESTATE, SECRET AGENT PROPERTY SERVICES

Licence fee cut short of adequate: networks

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Original article by Jake Mitchell
The Australian – Page: 28 : 5-May-16

Macquarie Securities estimates that Nine Entertainment Company’s EBITDA will increase by $A10.9m due to the reduction in broadcasting licence fees in the Australian Government’s May 2016 Budget. The EBITDA of Seven West Media and Ten Network will rise by $A12.1m and $A7m respectively. Seven West CEO Tim Worner says the 25 per cent reduction in the annual licence fee is insufficient for commercial TV networks to remain competitive.

CORPORATES
NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, SEVEN WEST MEDIA LIMITED – ASX SWM, TEN NETWORK HOLDINGS LIMITED – ASX TEN, MACQUARIE SECURITIES PTY LTD, NIKKO ASSET MANAGEMENT GROUP, STANDARD AND POOR’S ASX 200 INDEX, SOUTHERN CROSS MEDIA GROUP LIMITED – ASX SXL

Ratings groups keep their powder dry

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Original article by Jacob Greber
The Australian Financial Review – Page: 3 : 5-May-16

Rating agencies Standard & Poor’s and Moody’s will assess the Australian Government’s May 2016 Budget before deciding whether to review the nation’s coveted "AAA" credit rating. National Australia Bank’s Alan Oster says the Budget measures should be sufficient to avoid a ratings downgrade, but adds that Australia’s credit rating outlook could potentially be revised. Meanwhile, Moody’s forecasts 3.7 per cent growth in nominal GDP in 2016-17, while the Treasury expects 4.25 per cent growth.

CORPORATES
STANDARD AND POOR’S CORPORATION, MOODY’S INVESTORS SERVICE INCORPORATED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. DEPT OF THE TREASURY, TD SECURITIES, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, DEUTSCHE BANK AG

Treasury’s medium-term price forecast paints unsettling picture

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Original article by Geoff Winestock
The Australian Financial Review – Page: B13 : 4-May-16

The Australian Government’s May 2016 Budget forecasts include a 1.35 per cent increase in the nation’s terms of trade in 2016-17. The Mid-Year Economic and Fiscal Outlook had forecast a 2.25 per cent decline in the terms of trade. Meanwhile, the Treasury has upgraded its forecast for the iron ore price in 2017 from $US39 per tonne to $US55. The price of metallurgical coal has been upgraded from $US73 per tonne to $US91.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Average Joes saved from bracket creep

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Original article by Fleur Anderson
The Australian Financial Review – Page: B5 : 4-May-16

The 37 per cent personal income tax rate threshold will be raised from $A80,000 to $A87,000. The new measure, announced by the Federal Government in the May 2016 Budget, will take effect on 1 July. Treasurer Scott Morrison said that 500,000 taxpayers will benefit from the "bracket-creep" tax cut.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY

Morrison carves up super to fund business tax cuts

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Original article by Phillip Coorey
The Australian Financial Review – Page: B1-B2 : 4-May-16

The Australian Government forecasts that the Budget deficit will rise from $A37.4bn to $A39.9bn in 2015-16, while it expects the nation’s net debt to peak at 25.8 per cent of GDP in 2017-18. The May 2016 Budget outlines plans to progressively reduce the tax rate for all businesses to 25 per cent by 2026-27. Businesses whose turnover does not exceed $A10m will benefit from 1 July, when their tax rate will be reduced to 27.5 per cent. The Budget also includes changes to the tax regime for superannuation contributions and an increase in the $A80,001 income tax threshold to $A87,001.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, RESERVE BANK OF AUSTRALIA

TV licence fees cut while ABC, SBS get extra funds

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Original article by Fleur Anderson
The Australian Financial Review – Page: B15 : 4-May-16

Communications Minister Mitch Fifield says a further reduction in free-to-air TV networks’ licence fees will be considered later in 2016. The annual licence fee was reduced by 25 per cent in the Australian Government’s May 2016 Budget. This will make the networks more competitive against streaming rivals such as Netflix, which are not subject to licence fees. The Budget also includes additional funding for the ABC and SBS.

CORPORATES
AUSTRALIA. DEPT OF COMMUNICATIONS AND THE ARTS, NETFLIX INCORPORATED, AUSTRALIAN BROADCASTING CORPORATION, SPECIAL BROADCASTING SERVICE (SBS), APPLE INCORPORATED, NBN CO LIMITED

ALP in front but Election too close to call: ALP 51% cf. L-NP 49%; Roy Morgan Government Confidence falls to 98 – lowest since Turnbull became PM.

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Original article by Roy Morgan Research
Morgan Poll Update – Page: Online : 2-May-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 risen by one per cent to 51 per cent. The poll, which was carried out on the weekends of 23-24 April and 30 April-1 May 2016, also shows that the Coalition’s primary vote has fallen by 0.5 to 40 per cent per cent, while the Roy Morgan Government Confidence Rating has fallen by one point to 98. Roy Morgan Research executive chairman Gary Morgan says the looming Federal Election means tomorrow’s Federal Budget is the Turnbull Government’s best chance to shape the narrative and lay out the ground on which this year’s Federal Election will be fought. The Government has clearly gone into "election-mode" already with the announcement last week of a $50 billion defence spending commitment to build 12 new Shortfin Barracuda submarines in South Australia – although under contract to French company DCNS.

CORPORATES
MORGAN POLL, ROY MORGAN RESEARCH LIMITED, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA, AUSTRALIAN LABOR PARTY, AUSTRALIAN GREENS, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, DIRECTION DES CONSTRUCTION NAVALES

Tax cut to 27.5pc for SMEs while big end of town waits

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Original article by Sid Maher
The Australian – Page: 1 & 4 : 3-May-16

The Australian Government’s May 2016 Budget will include a one per cent reduction in the small and medium enterprise tax rate, to 27.5 per cent. The lower tax rate is expected to apply to companies with turnover of up to $A5m, compared with a threshold of $A2m at present. Unincorporated businesses and sole traders are also expected to receive tax relief in the Budget. However, the tax rate for large companies will remain at 30 per cent, although the Government plans to progressively reduce it to 25 per cent.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Tighter controls on super top-ups

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Original article by David Crowe
The Australian – Page: 1 & 4 : 3-May-16

The Australian Government’s May 2016 Budget will include new limits on personal contributions to superannuation funds and an increase in the tax on super contributions by people whose annual income exceeds $A250,000. The Budget will also feature superannuation measures for people on low incomes, as well as women who go on maternity leave. There will also be changes to the "transition to retirement" regime.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY