Tax cuts for most workers will be of great benefit to the Cairns economy. The Federal budget is designed to put more money in your pocket so that you will spend thus circulating the economy approximately 10 times as advised by economists. This appears to be a great strategy.
Other key points are for those receiving pensions including family tax benefits. There will be 2 additional payments of $250 twice a year to pensioners, which once again, is designed to circulate in the economy. The Federal budget is designed to drag us out of recession. The best way out of a recession is to create an environment so that people will spend a little more which will circulate the economy. This will then create jobs thus becoming a self-perpetuating solution.
The Federal budget will allow a business to write off newly acquired assets instantly. This is effective in preserving the cash flow for that period of time. However, it is advised that with a rising income, that this may not be suitable for your business. Depreciating (writing off the cost of the asset over a number of years) may not be the best strategy for the short term thus the instant asset write-off may be of great cashflow benefit for the year.
Whilst the budget relies on some big assumptions, particularly with the COVID-19 vaccine being available, it is designed to stimulate the economy by providing tax cuts for just about all concerned. This will increase the spending in the local economy, thus driving Cairns out of recession.
