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Lendi’s Federal Budget 2017 Overview

Treasurer Scott Morrison promised that this year’s budget would show that the Government understood the frustrations of many Australians. But did they deliver? See who the major winners and losers of Federal Budget 2017 are.

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THE WINNERS

Children, parents and teachers

Schools will receive an extra $18 billion over the next ten years, on a needs-based basis. This amount is lower than previously expected, however, and the proposal will still need to go through Parliament.

Commuters

The Government's $50 billion infrastructure program from last year's budget is will be brought forward. This should fast track roads, rail and other major infrastructure projects, including a rail link connecting Melbourne and Brisbane.

Frequent Flyers

The Coalition will bankroll the construction of a second Sydney airport at Badgerys Creek, after Sydney Airport declined to take on the project. The total costs and the terms will be detailed in the budget.

GPs

In a bid to end the political fight with GPs, the Turnbull government will ease the Medicare rebate freeze in a move that could cost more than $43 billion.

Patients

The Coalition is hoping to bank around $1.8 billion in savings over five years by encouraging doctors to prescribe more generic drugs and other measures agreed with Medicines Australia. Medicare rebates will rise, while the costs of medicines will fall.

The Australian Federal Police

Additional funding will be provided to allow for the hiring of new officers, and to enable counter-terrorism measures.

Big businesses

The first tranche of the 10-year plan was passed in April giving businesses with a turnover of up to $50 million a tax cut. The Coalition wants to extend this to all businesses.

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THE LOSERS:

University students

Student fees will increase by 7.5 per cent by 2021. The price of a four-year course will go up by $3,600, with the most expensive 6-year medical degree potentially costing $70,000+. Students will also be required to begin repaying university debts earlier, when they earn $42,000 a year as opposed to the current $55,000.

Oil and gas

As a result of a Petroleum Resource Rent Tax, oil and gas companies could lose some of their generous tax deductions following a review of the tax.

Job seekers

Human Services Minister Alan Tudge is expected is introducing new measures to ensure welfare recipients are meeting their obligations, by looking for work and meeting with employment groups, if they are to continue receiving benefits.

And for property…

Foreign investors are losing out. Those who leave their residential properties vacant will be fined thousands per property. This is in an effort to open up more properties to both buyers and renters. And, foreign property owners will also have to pay the capital gains tax when they sell their primary residence.

Pensioners are somewhat on the middle ground. They’re not receiving fines, and they’re not receiving cash incentives, but rather they’ll benefit from the removal of disincentives when it comes to moving house.

property-growth

Those who sell their primary home will be able to put some of the money from the sale into their super. This is in an effort to encourage pensioners to downsize, a move which could potentially open up thousands of properties for new home buyers each year.

Lastly, in a move similar to how employees salary sacrifice for their super, first home buyers will be able to set aside some of their pre-tax income into their super in order to help them save more quickly for a home.

For now, it looks as though there will be no changes in regards to negative gearing, the capital gains tax or the highly contentious stamp duty tax.

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Tags: saving, federal budget 2017, investing, retirement planning, family home, first home buyer

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