On the 9th May, Australian Treasurer Peter Costello presented his 11th Federal Budget to Parliament.
The main highlight of the budget was the personal tax reductions accross all levels, including dropping the rop tax rate from 47% to 45% and increasing the top threshold to A$150,000.
These will be worth A$36.7bn over 4 years and clearly demonstrate Australia's committment to have an internationally competitive tax system.
A number of other spending initiatives were also announced and the budget has been well recieved and the tax reductions warmly welcomed.
Some other key elements include the expansion of Family Assistance Benefits, boost to infrastructure spending, increased defence allocations and extra incentives for business investment through higher depreciation write offs.
All Australian and overseas property investors are set to benefit from the tax savings.
In particular, the reduced taxation will act as a lure for the one million Australian Expatriates and hundreds of thousands of potential migrants which the government is keen to return to Australia to relive the acute skills shortage being experienced in Australia.
Even with the tax reductions, the government has once again been able to keep the budget in surplus, expected to be A$10.8bn in 2006-07, and this comes after the announcement that it has now fully repaid all foreign debt, leaving Australia debt free and profitable for the first time ever.
Growth is expected to come in at 3.25% so the economy continues to progress steadily and offer investors the prospect of a stable, growing and financially strong environment which should give us the best chance to profit on our Australian property investment.
aussieproperty.com has prepared a detailed Special Report on all the budget announcements with analysis of the key drivers of policy and how it will impact on overseas based Australian Property Invetsors.
It can be found in our Members Only Special Reports section, available live once you have registered as a member of aussieproperty.com
