News National Deficit may be less than thought

Deficit may be less than thought

Twitter Facebook Reddit Pinterest Email

The federal deficit for this financial year could be slightly smaller than predicted when Treasurer Joe Hockey hands down his budget on Tuesday.

Just days from Mr Hockey handing down his first budget, the latest monthly statement for this financial year shows the deficit running at just more than $1 billion less than had been predicted.

The March financial statement showed the deficit at $34.78 billion compared with the forecast $35.81 billion.

The difference relates to lower-than-expected cash payments being partially offset by lower-than-expected cash receipts.

The deficit was forecast at $47 billion for the full year.

The report also showed $175 million of previously overpaid minerals resource rent tax (MRRT) was paid in March.

It means the mining tax has raised just $137 million after nine months.

It was forecast to raise $500 million for the year.

Finance Minister Mathias Cormann said this was further evidence that Labor’s failed mining tax must go.

A further $10.6 million was refunded in April and comes on top of the $52.1 million refunded between July 2013 and February 2014.

Meanwhile, the Australian Taxation Office has spent more than $50 million to administer the tax.

“The mining tax was always a bad tax,” Senator Cormann said in a statement.

It was complex, badly designed, costly to administer and comply with and didn’t raise any money, he said.

Legislation to abolish the tax is stuck in the Senate, where it has been rejected by Labor and the Greens.

Senator Cormann said Opposition Leader Bill Shorten should cut his losses and support the legislation.