Australia delivers tax cuts, surplus in pre-poll budget

3 April, 2019 12:00 AM printer

CANBERRA: Australia's conservative government on Tuesday proposed tax cuts for low and middle-income earners and record spending on health and education while delivering the first budget surplus in more than a decade, setting up its campaign for an imminent election.

Treasurer Josh Frydenberg offered A$158 billion (US$111 billion) in tax cuts over the next decade primarily aimed at middle-income earners, on top of tax cuts of A$144 billion last year, as the coalition government, which is trailing in opinion polls, tries to win over voters, report agencies.

An election must be held by mid-May and could be called as soon as this week.

"We will ask the Australian people: "Who do you trust to deliver lower taxes?"," Frydenberg told a media conference.

"The coalition has the track record of delivering."

Frydenberg predicted a budget surplus of A$7.1 billion in the fiscal year ending June 2020, up from a December forecast of a A$4.1 billion surplus, as higher export receipts and tax revenues boost government coffers.

If achieved, it would be the first surplus since 2007/08, before the global financial crisis hit.

The projected surpluses increase to S$11 billion in 2020/21 and A$17.8 billion in 2021/22 before easing to A$9.2 billion in 2022/23.

Offering potential swing voters an immediate dividend, the government said it will double the tax rebate for people earning between A$48,000-A$90,000 a year to A$1,080 in the current fiscal year.

Budget papers showed the cost of the tax cuts out to 2021/22 would be A$15 billion.

Frydenberg also proposed changes in future years that would see income bands widened and tax rates reduced to deliver personal tax cuts.