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Federal Budget will boost WA confidence and economy

The WA business community today congratulated the Federal Government on a sensible budget that will boost jobs and business confidence, but warned that spending restraint must continue to be a focus given that global economic growth underpins the positive Budget outlook and is not guaranteed.

Chamber of Commerce and Industry WA (CCI) Chief Executive Officer Chris Rodwell said CCI welcomes today’s confirmation that the Government’s savings measures and a stronger economic outlook will put the Budget back in surplus a year earlier than forecast – $2.2 billion in 2019-20 – and a forecast reduction in net debt of $21.7 billion by the end of the forward estimates.

“Reining in spending to reduce net debt must however remain a priority for the Federal Government, with the interest repayments to service this debt costing taxpayers $12 billion per year,” Mr Rodwell said.

“CCI congratulates the Federal Government for standing strong on its company tax policy. WA relies on attracting global investment so if we want to continue to attract investment to WA we must be competitive across the board, including our tax mix.

“No economy has a guaranteed VIP pass to economic growth and continued prosperity. Without a change to the company tax rate we are letting down Australian businesses in their efforts to be internationally competitive.”

The Government’s self-imposed 23.9 per cent of GDP cap on Government taxation is a responsible line in the sand for the size of Government in Australia.

“Targeted tax relief for low-income earners will boost confidence and help with rising cost of living pressures,” Mr Rodwell said.

“Personal income tax relief for those earning less than $90,000, and a plan to end bracket creep, will be welcome news to West Australians, who according to CCI’s latest Survey of Consumer Confidence, continue to cite cost of living such as groceries, utilities, and transport as their greatest weight on confidence.

“In WA, household spending has grown by just 0.7 per cent on average for the past three years, putting a significant strain on small businesses, particularly in the retail sector which today reported zero growth compared to last month.

“WA business welcomes today’s confirmation that the small business $20,000 instant asset write-off will be extended for another 12 months to 30 June 2019, providing the backbone of our economy with more funds to innovate, invest back into their businesses, grow their operations and create more employment opportunities for workers.”

The Federal Government’s $3.2 billion infrastructure package will be a much-needed boost to our State’s economy.

“This will go a long way toward addressing WA’s infrastructure needs and will underpin future economic growth and productivity,” Mr Rodwell said.

“It’s a vote of confidence in the Government’s METRONET project that will create hundreds of jobs and opportunities for WA businesses.

“While CCI has welcomed the Federal Government’s $189 million hospital infrastructure package to increase WA’s GST share from 47 cents to 50 cents, as the Federal Treasurer has admitted, band-aid solutions to the broken GST distribution are not enough.

“The Productivity Commission has backed CCI’s proposal to fix the GST in its draft report – the only organisation to have this support – in the interest of boosting the national economy.

“Short-term top-ups can no longer be the answer. Structural change must be made to encourage all states to grow their own economy.”

“Fixing the GST distribution will ensure that next year’s Budget outlook is even more positive than today’s.”

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