How socialism works
What's mine is mine...what's yours is mine.
Source AFR
Australia's big four banks plus Macquarie will be hit with a new state-based version of the major bank levy which will reap $370 million over the next four years for the South Australia Government as it ramps up spending on infrastructure in a struggling economy.
South Australian Treasurer Tom Koutsantonis said the banks were fair game for the states as well as the federal government. He has imposed a new South Australian major bank levy equal to the state's share of liabilities which are subject to the federal major bank levy.
"Even if every other state follows they'd still be under-taxed," Mr Koutsantonis said of the banks.
The levy will apply at a rate of 0.015 per cent of South Australia's share of liabilities. It is projected to raise $97 million in 2017-18 and will begin on July 1, 2017. It is calculated on a formula revolving around the state's share of national gross domestic product, which is currently about 6 per cent.
SA Premier Jay Weatherill said he was the one who would personally telephone
Anna Bligh, the chief executive of the Australian Bankers Association at the conclusion of the budget lock-up in Adelaide on Thursday.
SA Premier Jay Weatherill said he would personally telephone Anna Bligh, the chief executive of the Australian Bankers Association at the conclusion of the budget lock-up in Adelaide on Thursday. Ben Searcy
The state-based bank levy is part of new revenue measures which also include a 4 per cent conveyance duty surcharge from January 1, 2018 on foreign buyers of residential property.
Other states including NSW and Victoria have even higher foreign residential property buyer surcharges. Mr Koutsantonis said he would prefer that offshore buyers invested in businesses.
"I want that investment in the business sector," he said.
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The state government raised spending on infrastructure such as hospitals, schools and roads to a record $2.2 billion for 2017-18 as it attempts to try and lift economic growth ahead of the closure of the manufacturing operations of car maker Holden in October this year.
The next state election is due to be held in March, 2018.
"We need the rest of the economy to step up," he said.
Jobs pushThe state's unemployment rate is the highest in Australia at 6.9 per cent. It also announced a $200 million Future Jobs Fund where businesses can apply for grants and low-interest loans from mid-July through to the end of September to try and stimulate expansion and jobs growth. It is particularly focused on the defence, food and wine, tourism, health research, mining and renewable energy sectors.
Mr Koutsantonis said he had written to Federal Treasurer Scott Morrison asking him to match the $200 million spending for the Future Jobs Fund.
There are extra incentives for off-the-plan apartment buyers and also for small to medium businesses, through the second year of a $10,000 cash grant for SME businesses who hire a new worker. This has also also been expanded to $15,000 for those hiring a new apprentice.
He said a consistent approach was needed for job creation and economic stimulation rather than one large bang. "You don't put all your frocks in the shop at once," he said.
The state budget bottomline continues to be bolstered by the stepped privatisation of the compulsory third party motor insurance entity, the Motor Accident Commission.
The latest budget papers show the total injection to the state's coffers has been $2.8 billion under the process which first began in 2014. Mr Koutsantonis said he would have been making different decisions about spending without those proceeds.
The state government didn't give an estimated sale price for the government-owned Land Services Group processing and transaction operations which it is in the final stages of selling off under a process where final bids are due by the end of July. There is speculation the asset could fetch more than $500 million.
The NSW Government reaped $2.6 billion from a long-term lease of its land titles services arm in April this year to Hastings Funds Management and First State Super.
The state government has forecast a small surplus of $72 million for 2017-18, which is down from the $382 million surplus forecast in December at a mid-year budget review. The surplus is forecast to be$132 million in 2018-19.
Premier Jay Weatherill said the closure of Holden in October was "a signal moment" for the state and people were wanting to know what the future held. He said the state budget was all about job creation and laying out a future pathway that would inspire more confidence.
"Then elections look after themselves," Mr Weatherill said.
