According to financial commentator David Koch, the Government is likely to announce that the Federal Budget is facing a $12 billion deficit due to weakening revenue from mining and the carbon tax as well as reduced company tax revenue.
In view of this and the fact that the Federal Government needs to fund the National Disability Insurance Scheme and find sufficient revenue to implement the Gonski reforms to the education system, Koch warns that the government may need to look for additional revenue. This could be by alternative measures that could see family budgets and incomes adversely affected.
An increase to the Medicare Levy is almost certain, says Koch, as a small increase provides the government with vast revenue without too much fuss as it is a hidden cost that comes out of your pay without being too obvious.
Koch also highlights a possible tightening of the rules governing eligibility for welfare. This would suggest that the income threshold for eligibility to receive the baby bonus, childcare rebate and Family Tax Benefit that currently stands up to a combined family income of $150,000 annually, could be cut out earlier.
Koch points out that it’s worthwhile doing the sums and evaluating what impact this could have on the family budget and whether it would be better to reduce the overall family income threshold to enable you to continue to receive these welfare benefits, or alternatively, tighten your belt and reduce expenditure to compensate.