It’s the most magical night of the year again for politics nerds with very weird ideas about what constitutes a magical night, that’s right: it’s budget night.
To save you the pain of having to watch the entire half-hour of Scott Morrison looking very pleased with himself, we’ve summarised the key areas of the 2017 budget.
One of the more newsworthy parts of this budget was the announcement of a 0.5% increase in the Medicare levy (up to 2.5%), which will be introduced in 2019. The money from the levy increase will mostly by used to help fund the National Disability Insurance Scheme.
ScoMo also announced that the government will be ending the Medicare rebate freeze (starting with rebates for bulk billing), meaning that the Medicare rebates paid to practitioners for medical services will be allowed to increase in step with the cost of providing those services. It’s expected that undoing the rebate freeze will roll out beyond bulk billing over the next few years.
The government is taking a hard line with welfare recipients, announcing a demerit system that would see those who accrue 4 demerit points (for things like missing appointments) have to go without payments for up to eight weeks.
The government will also be trialling drug testing with 5000 welfare recipients. Those that fail will be put on a cashless welfare card with the possibility of referral to treatment. (You can read more about that here.)
They’ve also mentioned that, as part of these changes, they will be denying welfare to those with a disability they have as a result of substance abuse.
ScoMo is banking (sorry about that) on raising a lot of money from the banks, with a new levy estimated to bring in $6.2 billion from Australia‘s five largest banks. He warned the banks that they shouldn’t be passing this cost on to the customer and told customers to take their business elsewhere if they do, let’s see how that plays out.
An attempt to tackle the housing crisis is being made but in basically every way possible except touching negative gearing.
Foreign investors are going to be hit with a $5,000 ‘foreign investment’ levy on any properties they purchase within the country that they don’t occupy for at least six months of each year. In addition to that, the capital gains tax withholding rate will be increased from 10% to 12.5% for foreign investors, with the threshold also being decreased, from $2 million to $750,000.
As had been floated earlier, from July 2018, first homebuyers will be able to dip into their super to fund a deposit, with the government allowing people to put up to $30,000 of their income into their super account at a lower tax rate for this purpose.
There are also plans to introduce incentives for retired couples living in larger homes to downsize and put the difference into their super.
It’s about to become even tougher to become a student, with the government set to reduce the threshold at which HECS payments must be remade, increase the rate at which HECS is paid back, and reduce government contributions to fees. Not fun.
Additionally, universities will be receiving 2.5% of their overall government funding.
The government has set aside $75 billion over the next decade for a whole lot of large infrastructure projects, including Sydney‘s second major airport at Badgerys Creek and Snowy Hydro 2.0.
It’s estimated that the budget will be at a deficit of $29.4 billion for the 2017-2018 financial year, and $7.4 billion surplus by 2021-2021.
If that was all a bit dry for you, here’s Morrison trying to argue with Leigh Sales about how the Medicare levy increase isn’t a tax increase:
— abc730 (@abc730) May 9, 2017
If you are an insane person, you can read the transcript of the budget address here.
Photo: Getty Images / Stefan Postles.