Budget 2022, catalyst to faster resurgence?

Team Veye | 03-Apr-2022 Budget 2022 catalyst to faster resurgence

Federal Budget in 2022 was presented in the background of just too many concerns occurring simultaneously.

The rise in inflation, spreading of new omicron variant and an environment of continuing economic uncertainty were followed by the currently ongoing Russia-Ukraine crisis.

The Australian economy has recovered strongly and is set to return to pre-pandemic levels nine months earlier than expected. Its economy has grown faster than any of its peers. Nominal GDP likely to increase 10.75 per cent, around double the normal rate.

The unemployment rate’s recovery is expected to be five times faster than the 1990s recession. The Government's Economic and Fiscal Strategy will secure the economic recovery by supporting strong and sustainable private sector led growth and job creation to drive the unemployment rate down to pre-crisis levels or lower.

The strength in Australian economy has prompted the Government to bring about short term cost of living measures which includes a temporary fuel excise cut, one off payments of $250 to eligible recipients and an increase of $420 to the Low-to-Middle-Income Tax Offset.

The budget besides making long term commitments for defence, cybersecurity and regional infrastructure is also laying the foundations for Australia to be a leading digital economy and society by 2030.

During the pandemic Australians adopted digital technologies more swiftly than ever before. To build on this momentum, the government is making significant investments in digital infrastructure. The Government also announced 120% tax deduction for small businesses to upskill employees and encourage digital adoption. It is committing $111.3 million to accelerate the roll out of the Consumer Data Right (CDR) across the economy. The CDR supports its intent to be a leading digital economy by 2030, creating new data-driven jobs, products and services and empowering consumers to benefit from their data held by businesses.

Notwithstanding Russia-Ukraine crisis and resulting inflation pressures, Australian economy’s resilience throughout the pandemic are pointers to continuation of strong economic recovery with broad based growth in consumption, investment and exports alongside a stronger labour market, rising wages, income tax cuts, and stronger household income growth.


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