INFLATION HIKE; PARTIES IN TAX TUSSLE
Inflation jumps above five per cent
Annual inflation has risen to its highest level since the introduction of the goods and services tax in 2000, with Australia recording a rate of 5.1 per cent for the 12 months to the end of the March quarter. Consumer Price Index figures released by the Australian Bureau of Statistics show that the rising cost of automotive fuel and of new housing contributed most to the increase. Underlying inflation – which trims out large price rises and falls – was still recorded at 3.7 per cent for the year – the highest since 2009. Perth and Brisbane each recorded CPI inflation at six per cent or higher, with the latest annual national CPI figure well above the Reserve Bank of Australia’s 2-3 per cent band for a potential lifting of its target cash rate (presently 0.1 per cent). The RBA Board will consider monetary policy next Tuesday, May 3.
Coalition pledges taxation guarantee
Prime Minister Scott Morrison has zeroed in on Labor’s taxation policy, while claiming that the Coalition would deliver its planned $100 billion of tax relief over the next four years. The PM committed to no new taxes on workers, small business, retirees, housing, superannuation or electricity. He said the Coalition would continue to cap tax revenue at 23.9 per cent of Gross Domestic Product, while claiming that Labor had not supported a cap on the tax take.
Labor crackdown on multinational tax havens
Meanwhile, Shadow Treasurer Jim Chalmers has promised to crack down on multinational tax avoidance in Australia, in a bid to ensure that some of the profits were taxed where the products or services – particularly those of digital firms – were sold. Dr Chalmers has pledged that debt-related deductions by multinationals would be limited at 30 per cent of profits. He also promised to limit the ability for multinational companies to abuse Australia’s tax treaties when holding intellectual property in tax havens. Dr Chalmers said the measures would raise almost $1.9 billion in additional revenue over the forward budget estimates.
Coalition powers up Queensland energy projects
Scott Morrison has sought to shore up the Coalition’s position in Queensland, where it holds 23 of the state’s 30 federal seats, focusing on clean energy investment. He announced $275 million for two hydrogen hubs in the electoral battlegrounds of North and Central Queensland, as well as six carbon capture and storage projects in the state.
Labor outlines Pacific Islands defence, employment plans
With Leader Anthony Albanese in Covid-19 isolation, Labor’s Shadow Foreign Affairs Minister Penny Wong announced a suite of measures to address heightened security issues in the Pacific Islands. Senator Wong said a Labor government would establish an Australia-Pacific Defence School to train defence and security force members of Pacific Island nations, and bolster a maritime security program to assist with aerial surveillance. In addition, Labor would reform the seasonal worker program, with the Federal government to meet the upfront travel costs of Pacific agricultural workers in Australia. Later in the week, Labor announced that it would create an Advanced Strategic Research Agency, within Defence, to fund research in technologies for national security. Meanwhile, Mr Albanese will emerge from Covid-19 isolation to officially launch Labor’s campaign on May 1 in Perth, where the party is hopeful of gaining up to three seats.
Foreign share of population falls for first time since 2000
Covid-19 travel and immigration restrictions have resulted in the first decrease in the proportion of Australia’s overseas-born population in 21 years, according to figures released by the ABS. In 2021, just over 29 per cent (7.5 million migrants) of the resident population was born overseas, down on the almost 30 per cent recorded in 2020. England, India and China were the leading source countries. The proportion of overseas-born residents has generally risen each year since 1947, when just 9.8 per cent of the population was foreign-born.