VICTORIA’S WIN ON GST; NO RETURN TARIFF
Victoria gets $3.7 billion lift in GST revenue
Victoria is the major winner from the projected carve-up of revenue collected from the Goods and Services Tax (GST) in 2025-26. The Commonwealth Grants Commission (CGC) has recommended an increase in Victoria’s GST distribution by $3.7 billion, to $26.1 billion; Queensland’s GST distribution, however, is expected to fall $1.2 billion to $16.5 billion. All other states and territories are expected to receive increased GST distributions next year. The CGC attributed Victoria’s increase to the state’s inability to raise royalties from a coal industry, an increase in population, and a higher level of Covid-19 expenses. The pool of GST revenue is expected to increase from $90.6 billion in the current year to $95.1 billion in 2025-26.
No reciprocal tariffs on US, says PM
Australia has vowed not to impose reciprocal tariffs on the United States, in response to the Trump Administration’s 25 per cent tariffs on steel and aluminium imported into the US. Prime Minister Anthony Albanese said reciprocal tariffs would only raise prices for Australian consumers. The PM said that while it had been foreshadowed that no country would be granted an exemption, the Australian Government would continue to press its case to be excluded from the tariffs. He said Australian steel and aluminium exports to the US represented less than 0.2 per cent of the total value of its exports. Neither steel nor aluminium were in the top 10 of what Australia sold to the US, the PM said.
Metals manufacturers get $750 million export boost
Meanwhile, the Prime Minister has announced a $750 million package to assist the production and export of metal products. The funds will be available through the Future Made in Australia Innovation Fund, to help metals manufacturers develop innovation and low emissions technologies. Funding will be administered through the Australian Renewable Energy Agency. The PM said Australian metals exports, including alumina, aluminium, and iron and steel, accounted for more than $150 billion annually.
Consumers face electricity price shock
Residential and small business customers in some Australian eastern states face electricity price rises of up to nine per cent in 2025-26, under a draft price determination issued by the national energy regulator. The Australian Energy Regulator (AER) said that for residential customers the default market offer – an electricity price safety net – would rise of between 2.5 per cent and 8.9 per cent, depending on the region. Small business customers could see rises between 4.2 per cent and 8.2 per cent. The AER’s draft determination applies to New South Wales, South-East Queensland and South Australia. It attributed the forecast price rises to a lift in wholesale market and network costs, which had risen by between two per cent and 12 per cent for most customers. The default market offer acts as a reference price for market offers in each region under AER jurisdiction.
Treasurer lauds quicker approval rate for foreign investment
Treasurer Jim Chalmers has hailed the effect of recent reforms to Australia’s foreign investment regime, claiming that investment proposals are being processed faster. Dr Chalmers said a revised framework set a performance target to process 50 per cent of proposals to approvals within 30 days. He said the approval rate within 30 days had jumped to more than 50 per cent, up from 35 per cent in 2023-24. The Treasurer said the reforms attracted the investment needed by the economy, while providing greater clarity to investors.
NDIS growth rate curbed to under 10 per cent, says Rishworth
Growth rates in the National Disability Insurance Scheme (NDIS) have been trimmed to under 10 per cent per annum, according to NDIS Minister Amanda Rishworth. Ms Rishworth said latest NDIS data showed the scheme was tracking at around $700 million lower than initially forecast for 2024-25. She said the original growth rate in the scheme this year was 12 per cent; with scheme costs stabilising, the NDIS growth rate was on track to reach the government’s eight per cent target by July next year. Ms Rishworth said there was now greater clarity on scheme eligibility for the more than 700,000 participants in the NDIS, as well as measures to prevent fraud. Budget papers for 2024-25 forecast that the NDIS scheme would cost $48.7 billion in the current year, rising to $60.7 billion in 2027-28.