The government's accounts edged into a slightly lighter shade of red.Improvements in tax revenue - take a bow, Australian-owned banks, and the Inland Revenue's litigation team - and lower expenses mean the operating balance before gains and losses is $80
The government’s accounts edged into a slightly lighter shade of red.
Improvements in tax revenue - take a bow, Australian-owned banks, and the Inland Revenue’s litigation team - and lower expenses mean the operating balance before gains and losses is $800 million lower than expected for the half year.
Add in the investment gains from government-owned financial institutions and the accounts show a $1.5 billion improvement on expectations.
The operating deficit I still just over a $1 billion, but it was forecast to be slightly above $2.4 billion.
The banks’ losses in court against the IRD are the main reason the corporate tax take is up.
Once those are removed, “corporate tax receipts were lower than forecast,” says the Treasury report.
“This was largely due to lower than expected provisional tax assessments. As with other individuals’ tax this suggests that current year profitability was weaker than expected in the [half yearly] forecast and it is possible this will persist until the end of the year.”
PAYE and other source deductions were down $334 million (3%), mostly reflecting the impact of the recession on people in work and hours worked.
GST receipts though are up $140 million (3.5%) on forecasts.
