Marnie Banger and Paul Osborne
(Australian Associated Press)
Treasurer Josh Frydenberg hasn’t ruled out further tax cuts before the next election after it was revealed the federal government has billions of dollars up its sleeve.
The mid-year budget review, released on Monday, showed a cash splash could be on the cards before the May vote as the Morrison government gets closer to delivering its first budget surplus in more than a decade.
The government booked $9.2 billion in revenue “decisions taken but not yet announced”, with another $1.4 billion set aside for secret spending measures.
Asked whether there could be personal income tax cuts on the cards, Mr Frydenberg didn’t rule it out.
“We certainly want to lower people’s taxes and make sure that they can keep their hard-earned money,” he told Nine Network on Tuesday.
“That’s in the DNA of the Liberal and National government.”
In Canberra on Monday, Mr Frydenberg said the government would approach spending the money at is disposal in a “carefully considered, methodical way”.
The mid-year economic and fiscal outlook showed the government is on track for $4.1 billion surplus in 2019/20, almost double the $2.2 billion figure it had forecast in May.
Beyond that, the coalition expects to deliver surpluses for the next decade, including $12.5 billion in 2020/21 and $19 billion in 2021/22.
The government has also cut its deficit forecast for this financial year to $5.2 billion, from the $14.5 billion it had projected in May.
The improvements come after the government raked in more revenue than expected, buoyed by strong employment growth and corporate tax receipts.
Fewer payments such as the dole have also helped balance the books.
Labor says a rosy global picture has led to the better results.
“This is a government which is riding on the back of a good international economy and has given up on the task of budget repair themselves,” shadow treasurer Chris Bowen said.
“Growth is down, investment growth is down, wages growth is down, consumption growth is down, and the only thing that’s up is terms of trade.”
Growth is forecast to be 2.75 per cent this financial year, before speeding up to three per cent in 2019/20 and staying at that pace for the following two years.
The unemployment rate is projected to remain at five per cent this year, and remain that way up until mid-2022.