Last night the Federal Treasurer, Scott Morrison handed down his third budget which has some positive elements within it.
This budget attempts to give businesses and households confidence to invest and spend as the Government has committed to structural tax reform including tax cuts for lower and middle-income earners, company tax cuts and larger surpluses over the forward estimates as well as increased infrastructure spending.
Also, for businesses with a turnover of up to $10 million, the extension of the instant asset write-off for purchases under $20,000 is a positive.
I am disappointed the Government didn't take this opportunity to act on the Luxury Car Tax. This is now an irrelevant tax on industry and we will continue to advocate to Government for its removal.
Unemployment is expected to fall further over the next two years to 5% as the nation nears increased employment. Whilst increased employment is a good thing, it will not help the significant skills shortages in the automotive industry unless the filling of job vacancies is not a focus.
The $250 million Skilling Australians Fund may help, but there is not much detail on how the fund will “deliver business with the people and skills they need to grow their business”, as the Treasurer claimed. The State Government has announced it will match the Federal funding and we will be working with both Governments to ensure the fund is focused on helping us solve the skills shortages currently being experienced within the automotive industry.
Whilst it's never enough and paying down debt would have been nice, tax cuts for low income earners and businesses will boost the economy in the short-term, delivering more money into the pockets of mums and dads which will hopefully flow through to automotive businesses.
We now wait to see what Labor will do as this budget looks like the Government is preparing for an election sooner, rather than later.
But the question is when?