This blog summarises the initiatives contained in the 2022 Federal Budget # 2, announced on 25 October 2022. The budget didn’t contain many initiatives for investors, small business owners or individuals. The government would have been mindful to limit the stimulatory effect that budget initiatives can have in a high inflationary environment.
Child care subsidy
The government will increase the Child Care Subsidy from 85% to 90% for all families earning less than $530,000. The government has announced several initiatives to attempt to improve the transparency and accountability in the child care industry, including ACCC and Productivity Commission inquiries and reporting obligations for large providers.
More money for ATO tax compliance
The government has extended the Personal Income Taxation Compliance Program, ATO Shadow Economy Program, ATO Tax Avoidance Taskforce by spending more than $280 million on tax compliance programs. It is clear that the government will rely on these measures to raise tax revenues.
Extend paid parentally leave
From 2026, paid parentally leave will be increased from 20 weeks to 26 weeks.
Affordable housing
The government will provide $350 million to the Housing Accord over 5 years from 2024 to support the funding of an additional 10,000 affordable homes per year. Given new home supply is usually around 180,000 per year, this initiative is unlikely to have a material impact on housing affordability for most Australians.
The government will spend $324.6 million to fund the Help to Buy scheme to assist
people on low to moderate incomes to purchase a new or existing home with an equity
contribution from the government.
Increase in skilled migration
The permanent Migration Program will be expanded to 195,000 in 2022–23. This is an increase of 35,000 or 22%. This should assist with businesses/industries that are experiencing labour shortages but will increase demand for housing and rental properties.
Energy efficient SMEs
The Government will provide $62.6 million over 3 years to support small to medium enterprises to fund energy efficient equipment upgrades. The funding will support studies, planning, equipment, and facility upgrade projects that will improve energy efficiency, reduce emissions or improve the management of power demand.
Downsizer contribution
The government confirmed it will legislate reducing the eligible age for the downsizer contribution from age 60 to 55, although this legislation is yet to be passed by the parliament.
2022 Morrison government budget
A summary of the first budget in 2022 handed down by the Morrison government on 29 March 2022 can be found here. All these initiatives will be, or have already been, implemented
