Example Of Fiscal Policy - 795 Words

Research Fiscal stance Since the budget 2017-2018 will cause a deficit of $29.4 billion, which is decreased by $8.2 billion compares to the budget 2016-2017[1], the fiscal stance the government is adopting tends to be contractionary. To return to surplus within four years and create a surplus of $7.4 billion in 2020-2021, government adopts the contractionary policy to reduce the deficit and increase the surplus. And another reason for adopting contractionary policy is to raise the economic growth from 2.75% (2017-18) to 3.0% (2018-19). The federal government also starts to pay attention to globalization, small business owners and areas where technological change happens. The four main things this budget choose to focus on are: growing†¦show more content†¦In addition, government will expense $33.8 billion in education, $30.1 billion in defence and so on. [3] Total expenses for 2017-18 are expected to be an increase of 3.0 per cent on estimated expenses in 2016-17 at $464.3 billion.[5] [3] [3] [5] Revenue in 2017-18 An increasing taxation is introduced in budget 2017-18. A new six-basis point levy on the big banks’ liabilities has been started up which will secure $6.2 billion over the budget. This extra revenue is supposed to support budget repairment and save money expenses in budget. Besides, the government plans to post a higher taxation with multinationals in order to crackdown on multinationals not paying their fair share of tax. The personal income tax rates remains the same as 2016-17 and the Medicare levy will rise from 2% to 2.50% in 2019.[4] And there will be a tax cut for small business owners and first home buyers as an encouragement. Tax revenue will rise by more than $20 billion mainly due to the increased taxation from multinationals and major banks. Total revenues for 2017-18 are supposed to bring an increase of 7.8 per cent on evaluated revenue in 2016-17 at $444.4 billion.[5]This rising tax revenue can help the government reach the surplus in 2020-21. [5] [4] Proposed government reform package In 2017-18, the federal government will put downward pressure on rising housing costs. In order to reach a greater housing supply and get moreShow MoreRelatedMonetary and Fiscal Policy Essay examples1403 Words   |  6 Pagesand fiscal policy and their applications to the third world countries with a huge informal sector This essay seeks to explain what are monetary and fiscal policy and their roles and contribution to the economy. This includes the role of the government in regulating the economical performance of a country. It also explains the different features and tools of monetary and fiscal policy and their performance when applied to the third world countries with a huge informal sector. 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