World News – African Union Budget – New South Wales: $ 16 billion deficit as Treasury unveils a plan to replace stamp duty with annual property tax

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Dominic Beirutet says the Covid pandemic led to $ 6. 9 billion this year, which will rise next year

The New South Wales government will try to adjust the historic $ 16 billion budget deficit bought by the Covid-19 pandemic by making a major overhaul of its tax system.

New South Wales State Treasurer Dominic Beirut presented his fourth budget on Tuesday, and outlined the devastating losses the epidemic has left on the state’s economy, including $ 6. $ 9 billion in 2019-20, it is projected to rise to $ 16 billion in 2020-2021.

At the height of the restrictions imposed to stop the spread of the virus, Beirutet said in his budget speech that the cost to the state’s economy was estimated at $ 1.. 4 billion every week. The country’s economy contracted by 8%. 6% in the June quarter, the worst on record, and nearly 270,000 jobs were lost between March and May. The country’s net debt is expected to peak at $ 104 billion by June 2024.

Beirut told Parliament after the budget was released: « Sometimes big numbers like this don’t look real. ». But their impact on our people is very real.

The surprising deficit is the result of Covid-19’s stimulus spending of $ 29 billion – the largest of any country – and an expected drop of $ 25 billion in revenue over the next five years..

To stop the downturn, Beirutit said, the government will gradually eliminate stamp duties on new property purchases in favor of the annual land tax. The New South Wales government has indicated that the move could inject an additional $ 11 billion into the state’s coffers over four years.

But it won’t happen all at once. Instead, the treasurer said, the government will initiate a public consultation process on a proposal to give homebuyers the option to withdraw from paying stamp duty in favor of the annual property tax.. . The change will not affect existing owners who do not buy or sell real estate, and the stamp duty waiver for first home buyers who buy property costing less than $ 1 million will be replaced by a $ 25,000 grant..

Beirutet said the change will give the country a « realistic path to achieving the most important economic reform of the state in the past half century. ».

« Stamp duties are a relic of a bygone era when you chose one profession, started a family, bought a house and settled down basically for life, » he said.

“Adds tens of thousands of dollars to the cost of the largest financial commitment most people have ever made. If you want to move, change jobs, switch jobs, enlarge or downsize to match your family size, stamp fees can be the key to the business.. It is holding back our economy at a time when we need to completely suffocate us.

The government has also unveiled a number of spending initiatives aimed at encouraging growth, including a $ 500 million “Overseas Voucher,” which will give every adult in the state $ 100 to spend on dining out or visiting cultural attractions in the state..

The government will also spend $ 812 million to build 1,300 new social homes across the state. Just over half of them will be built in the Sydney metro area.

Another $ 120 million will be spent providing free pre-school to nearly 44,000 children under five, and $ 337 million to provide teachers for school students whose learning has been disrupted during the Covid-19 lockdown.

Beirut told Parliament that low interest rates mean it is a « golden opportunity » for the government to spend.

He said, « Do nothing that will cause long-term harm to future generations, and we will not let that happen. ».

The government also announced new spending measures on infrastructure projects, including $ 10. $ 4 billion over the next four years in the West Metro program and $ 9. 2 billion on a new metro line to the new Sydney Western Airport.

Business groups welcomed the new spending measures. “This massive spending budget puts Sydney in a strong position to lead the country’s economic recovery, through financing for large transportation infrastructure projects and other job creation and investment factors,” said Sydney Chamber of Business Executive Director Catherine Origen.. .

However, the unions renewed their criticism of the government’s previously announced decision to end wage increases for frontline workers, including nurses and paramedics, at 1 pm. 5%.

New South Wales, Dominic Beirutet, government budget, stamp duties

World News – African Union Budget – New South Wales: A deficit of up to $ 16 billion as the treasurer unveils a plan to replace Stamp duty annual property tax

Ref: https://www.theguardian.com

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