Clever, Queensland pre-election budget according to BDO
13 June 2017
The Palaszczuk Government’s third state budget has been labelled as a fairly clever, pre-election budget with the clear winners being the building and construction industry with the multitude of infrastructure projects announced alongside health and education according to leading audit, tax and advisory firm, BDO.
The budget, designed to build business confidence, had social appeal to Queenslanders and was community and regionally minded with prudent spending said Leisa Rafter, BDO tax partner.
“The government has made hay while the sun shines. The unexpected increase in the coal price has led to additional coal royalty revenue, contributing to the $2.8bn surplus, and allowed the Queensland Government to touch major sectors across the state including transport, education, tourism, health, infrastructure and energy. This budget plays well to the heartland which will hopefully give a social return but also shows signs of prudent economic management” she said.
Ms Rafter interpreted the major tax implications from today’s budget as follows:
- 1.5% land tax surcharge for absentee payers of land tax. The surcharge will apply to land holdings with a taxable value of $350,000 or more and be in addition to the current land tax payable. It is not clear whether this will be limited to residential land as it is in other Australian States.
- First home owners grant increase to $20,000 for newly constructed homes or apartments has been extended for a further 6 months to 31 December 2017 at which time it will drop back to $15,000.
- Office of State Revenue Transformation Program is estimated to increase government revenue of $197million over the next 5 years. Costing for the program is approximately $67million.
- The Government has announced a 3.5% increase to vehicle registration duty, effective 1 July 2017. This increase represents almost double the inflation rate.
- The Government has confirmed that it will continue with the increase of the payroll tax rebate on wages for apprentices and trainees from 25% to 50% until 30 June 2018. The rebate is aimed at enabling Queensland employers to develop a highly skilled workforce and will be able to be used as an offset against payroll tax payable on the wages of other employees.
Nicola Purser, BDO’s partner in charge for research and development initiatives commented.
“Great to see the Queensland Government redirect $10m from less popular Advance Queensland programs to the highly popular Ignite Ideas. Expect Round 3 to open soon! Ignite Ideas provides grant funding of up to $250k for proof of market or proof of product activities.”