Posted on 09/30/2003 3:27:24 AM PDT by Dundee
(Treasurer) Costello unveils king-sized surplus
BUMPER company tax receipts have boosted the Budget surplus to $7.5 billion, handing the Government more ammunition for tax cuts ahead of the upcoming election.
Australia's 2002/03 Budget surplus came in at almost double the $3.9 billion forecast in May.
"The Australian Government recorded an underlying cash surplus of $7.5 billion in the year ending on 30 June 2003," Mr Costello told reporters, releasing the final Budget outcome for the year ending June 30, 2003.
"This was $3.6 billion higher than estimated at the time of the Budget."
Mr Costello said the large surplus came on the back of better than expected company taxes which were $2.1 billion above the forecast.
"This was predominantly due to higher than expected receipts from companies, indicating stronger company profits than expected at budget," he said.
The Government also reaped an extra $1.0 billion in taxes from individuals.
On the spending side, there were lower payments for welfare and family tax benefits and lower education costs.
The final budget outcome showed general Government net debt fell $8.4 billion in 2002/03 to $29.7 billion from the $32.4 billion forecast in May.
Mr Costello said net debt was 3.9 per cent of GDP, the lowest level in 20 years.
"In total, net debt has been reduced by $66.6 billion over the last six years of the coalition government."
Access Economics had predicted a result of as much as $6 billion, on the back of strong company taxes.
The report does not revise forecasts for the current financial year, which is predicted to produce a surplus of $2.2 billion after economic growth of 3.25 per cent.
Australia was in a strong fiscal position and a better position than any G7 country and almost all developed nations, Mr Costello said.
"This is a strong result by international standards," he told reporters.
"It puts Australia in a strong fiscal position.
"We would be in one of the strongest positions of the world, certainly much stronger than any of the G7 countries and nearly all of the OECD."
The 2003-04 surplus would be revised up in the mid-year Budget review, Treasurer Peter Costello said today.
"We're in a current year 2003-2004 where we have forecast a lesser surplus and of course the next May Budget will be for the 2004-05 year," Mr Costello told reporters.
"What the outcome is likely to be for the current year will be revised up in the mid-year review."
Mr Costello said there would be pressures on the Budget from things such as Australia's commitment of troops to the Solomon Islands.
"There will be some pressures on the Budget from measures which have not been passed by the Senate and from new expenses which have been entered into since the time of the Budget, the likes of which is Australia's commitment to the Solomons Islands," he said.
Australia's domestic economy was still growing very strongly despite problems overseas, Mr Costello said.
Mr Costello, announcing the outcomes of last year's Budget, said the domestic economy continued to defy major international factors.
"Although growth has come off in the Australian economy because of the external position, the domestic economy is still growing very strongly," he told reporters.
"The Australian consumer is confident, interest rates are low, they are spending, it is a good time for Australian companies.
"What is detracting from growth - international weakness, SARS, drought, all of those international factors."
Any FReeper who wants to visit Down Under should check out Perth or Adelaide. Perth is on the Western side of the continent, it's sort of like their "Los Angeles." Great restaurants and nightclubs. Adelaide has some great scenery and charm in a mid-sized town and is the gateway to the Outback. Sydney and Melbourne are nice but they're mostly tourist traps.
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