Industry groups have issued their wish lists for the Federal Budget, with an emphasis on reducing red tape and taxes, but the Government is also under pressure to target Australia’s rich.
CPA Australia has outlined seven major priorities, including a Budget that “reinstates economic confidence” and demonstrates leadership “through a long-term vision”.
It is also critical of the Government’s determination to return the Budget to surplus.
“Arguments can be made for targeting either a surplus or deficit,” it said in a statement.
“The major issues confronting Australians relates to the dynamics of market forces such as… the domestic inertia created by household debt and uncertainty over job security.”
“But, as CPA Australia stated two years ago, there is no need to break the land speed record to return the Budget to surplus.”
“The consequences for Australia’s long-term competitiveness could be disastrous.”
According to CPA Australia, the Government needs to address the many issues holding back Australia’s productivity performance, including an excess of red tape.
It also highlights the importance of the Asian Century, which “must be the catalyst for the structural changes necessary to bring about the necessary boosts to Australia’s productivity and competitiveness”.
“The Government must therefore… reallocate expenditure toward the industries of the future and delivering a workforce equipped with the necessary high-end knowledge and skills,” it said.
“In this vein, it must also seriously reconsider the merits of subsidies to certain industries that struggle in a hyper-competitive global and regional environment.”
Innes Willox, chief executive of the Australian Industry Group, has also raised concerns regarding the Government’s plan to achieve a budget surplus.
“Achieving a surplus would… increase the likelihood of lower interest rates over the coming year,” Willox said in a statement.
“However, there are undeniable risks in such a sharp fiscal consolidation. Any risks will need to be carefully managed.”
AIG is seeking measures in a number of areas, including:
Meanwhile, Treasurer Wayne Swan is under pressure from unions and the Greens to target Australia’s wealthy instead of cutting payments to jobseekers and low-income earners.
The Australian Council of Trade Unions wants the Government to impose a rule so very high-income earners pay at least the same average rates of tax as middle-income households.
The Government has indicated it will adopt the ACTU’s recommendation for the superannuation contribution tax to be higher for the rich, and will double it to 30% for those earning more than $300,000.
There is also speculation of further carbon tax compensation in the Budget, which will give low-income earners and pensioners a one-off windfall.
