Income tax continues to do heavy lifting

Paul Osborne
(Australian Associated Press)

 

The federal budget will become more reliant on personal income tax revenue as other sources dwindle and no action is taken on reaping more from gas and mining firms, a new report says.

The Parliamentary Budget Office on Wednesday released an analysis of the tax system since 2001 and some of the risks ahead.

The main changes since 2001 had been a drop in fuel excise due to fuel efficiency and a previous freeze in indexation, a fall in customs receipts due to free trade deals, and a drop in company tax receipts as losses are carried forward.

Based on recent trends, the report found the future would see a drop in company tax receipts, an increase in personal income tax receipts and drops in consumer tax receipts driven by consumer behaviour and technological change.

“If these risks to tax receipts eventuate, and in the absence of other taxation reforms, maintaining Commonwealth Government revenue at recent levels as a share of GDP will lead to an increasing reliance on taxes on labour income through the personal income tax system,” the report concluded.

The study found personal income tax already accounted for 53.7 per cent of commonwealth receipts.

In comparison, the report showed resource rent taxes made up 0.4 per cent of receipts.

Petroleum Resource Rent Tax had fallen as a share of GDP since 2001 despite the increase in petroleum production and exports and strong price growth through much of the period.

The report warns that although Australia is set to become a leading producer and exporter of liquefied natural gas, there is a “significant likelihood that this will not translate into higher PRRT revenue”.

Labor’s mining tax was abolished by the coalition in 2014.

Shadow treasurer Chris Bowen said the tax base clearly needed to be broadened, as the government continued to rely on income tax to fund basic services.

“The PBO’s key finding is premised on no tax reform occurring and the only major party going to the next election with a tax reform agenda which broadens Australia’s tax base is the Labor party,” Mr Bowen said.

Labor has announced reform of the taxation of trusts, tax affairs, negative gearing and capital gains tax, as well as removing dividend imputation refundability.

It’s also outlined plans for a “bigger, better and fairer income tax cut” for low and middle income earners than the government had proposed.

Greens spokesman Senator Peter Whish-Wilson said generous deductions for resources companies and rampant tax avoidance meant workers carried the heavier burden.

“Future budgets will still rely on bracket creep because the government’s income tax plan did not fix bracket creep – it just gave lots of money to wealthy people,” Senator Whish-Wilson said.

He said the government needed to abolish capital gains tax concessions, overhaul petroleum taxes, introduce a mining super profits tax and treat multinational tax avoidance more seriously.

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The WebApp you have when you’re not having an App

 

By Gavin Klose
(Product Manager, Feedsy)

 

Do you remember this 80’s classic ad for Claytons “The drink you have when you’re not having a drink”?

You’ve gotta love a bit of mime in a TVC!

 

So why the ad?

Well we reckon our new product is a bit of a “Claytons” App (but in a good way).

 

We’ve been working on improving the entire app experience: from publishing, updating and promoting through to actually downloading them.

What we have developed is an app that tastes like an app but sneakily isn’t really an app – but is actually better than an app…

 

Introducing FeedsyWebApps.

 

With FeedsyWebApps, people no longer have to visit an app store and download anything.

Instead, FeedsyWebApps promotes itself to anybody viewing your Feedsy content on their mobile device with a pop-up. The pop-up displays how to add you as an App icon with visual instructions of how to “Add to Home Screen“. This pop-up only displays once a day or until that person actually follows through and does it.

So no need for you to worry telling people about it – as they will discover it for themselves.

Another huge plus for FeedsyWebApps is instant access to all web features of your FeedsyWeb because is essentially a mobile version of your FeedsyWeb. So any changes to functionality or branding on your FeedsyWeb is instantly available on your FeedsyWebApps.

No more waiting for app development, uploading and waiting for approval from the App Gods.

 

So is FeedsyWeb really the Clayton’s App?

Lets’ see…

Available everywhere – TICK

  • People don’t need to go to the App store (or a Bottle Shop) to find your FeedsyWeb.
  • So no more, “What is my iTunes/GooglePlay username and password again?!!”
  • It’s available wherever people are browsing its content (it’s like someone offering them a bottle of Claytons whenever they’re thirsty).

Stay active and in control – TICK

  • We (and you) were always at the mercy of the App Stores and their ever shifting rules and specifications – a bit like getting lost in your second bottle of red and being exposed to breathe tests.
  • If it now works on yourFeedsyWeb, it also works on your FeedsyWebApps – instantly and without the hazy “lag” of app development.

No Hangover – TICK

  • Whilst our “templated” FeedsyApps model meant low extra fees – there were still extra fees.
  • However, like Claytons, there is no regret the next day, because FeedsyWebApps is free on most plans*.

So turning mobile visits into apps withFeedsyWebApps is a Clayton’s app after all.

 

We have now activated this on our Feedsy channel – so you’ll be seeing a pop-up* real soon.

Or you can read more about it here: FeedsyWebApps.

We’d love to get your feedback!

 

Cheers!

 

* Note: Currently FeedsyWebApps only pop-ups in Safari (iPhone or iPad) and Chrome (Android) and is available (FREE) on Web+Mail Premium plans or higher.

Home values for the last 3 months and past 12 months

Christian Edwards
(Australian Associated Press)

 

Australian city house prices have posted an annual fall for the first time since November 2012, once again driven by lower prices in the two largest property markets.

National house prices retreated 0.1 per cent in April, the seventh straight month of declining prices, the latest data from CoreLogic shows.

Prices in Sydney and Melbourne, both fell 0.4 per cent for the month, pulling capital city values down 0.3 per cent, despite rises in Adelaide of 0.1 per cent and in Darwin and Canberra of 0.6 per cent.

Hobart was the only city where dwelling values rose by more than 1.0 per cent in April, up 1.2 per cent in the month, and up 12.7 per cent over the past year.

CoreLogic head of research Tim Lawless said after performing in the shadow of city markets for the last 13 years, the combined regions are now consistently outperforming the capitals.

Annual prices have climbed 9.8 per cent in Victoria’s Geelong and 9.2 per cent in NSW’s Southern Highlands, and Shoalhaven.

“The latest trends are virtually the opposite of what we have become used to over the past five or so years, regional areas are now outperforming the capitals and units are outperforming houses,” Mr Lawless said.

CBA senior economist Kristina Clifton said over the past year units are up 1.9 per cent while house values have dropped 1.0 per cent

“Unit prices may be holding up better because they tend to be located in the larger capital cities, such as Sydney and Melbourne, where population growth is strong,” Ms Clifton said.

The weaker conditions have been attributed to tighter credit policies which have slowed investor activity, with annual growth in investor housing credit up 2.5 per cent, compared to owner-occupier housing credit, which rose 8.1 per cent in the year to March.

Housing Industry of Australia senior economist Shane Garrett said heavier stamp duty bills on foreign investors has also impacted Sydney.

Sydney values are 4.3 per cent below their July 2017 peak, but still a full 66 per cent above their most recent low point of May 2012, Mr Garrett said.

In most capital cities, price growth has been weakest for the most expensive properties.

In Sydney, houses that make up the most expensive 25 per cent are down 6.3 per cent over the year, compared with a 0.5 per cent increase for the bottom 25 per cent of dwellings.


HOME VALUES:

Sydney: Down 1.2pct in the three months to April 2018, down 3.4pct in past 12 months

Melbourne: Down 0.7pct in past three months, up 3.7pct in past 12 months

Brisbane: Down 0.1pct in past three months, up 0.9pct in past 12 months

Adelaide: Down 0.2pct in past three months, up 0.8pct in past 12 months

Perth: Up 0.1pct in past three months, down 2.3pct in past 12 months.

Combined capitals: Down 0.7pct in past three months, down 0.3pct in past 12 months.

Data by CoreLogic.

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The government has targeted 2021 for turning the budget deficit into a surplus

Colin Brinsden and Paul Osborne
(Australian Associated Press)

 

Acting Prime Minister Michael McCormack has suggested the federal government will pay off its massive debt by 2021.

Mr McCormack found himself backtracking on his comment reported in the Daily Telegraph on Tuesday that Treasurer Scott Morrison would play “Santa Claus” announcing some “goodies” in the May budget.

Mr Morrison, who spoke with the Nationals leader on Tuesday after the article was published, played down the suggestion it will be a giveaway budget.

“I’m not Santa Claus – it won’t be Christmas in May – but I don’t intend to be the Grinch either,” he told ABC radio.

“What we will have is what we’ve always produced, and that is a responsible budget with measures the country can afford that are about investing in a stronger economy.”

Mr McCormack, who is standing in for Malcolm Turnbull while the prime minister is in the UK and Europe, later told reporters he was merely being “upbeat” about the budget’s transport and infrastructure spending.

He said the government had been able to put a record amount of money into roads and rail because it had managed the economy and budget well.

However, he went on to suggest debt – which stands at $523 billion – would be paid down within three years.

“I’ve already spoken to Scott Morrison and he is looking forward to the budget too,” Mr McCormack told reporters in Mildura.

“He’s looking forward, as he says, to producing a fiscally responsible budget. He’s looking forward to getting this nation back on track, so that by 20/21 we’ve paid down Labor’s debt.”

Shadow treasurer Chris Bowen said it had been a torrid first few days for the acting PM.

“Michael McCormack must still believe in Santa if he thinks if the government’s debt will be paid off by 2020/21,” Mr Bowen told AAP.

“The fact is the deficit for the current year is eight times bigger than what Abbott and Hockey originally forecast at their 2014 budget.

“And gross debt has just crashed through half a trillion dollars on the coalition’s watch with no projected peak in gross debt in sight.”

The government has targeted 2021 for turning the budget deficit into a surplus.

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US China trade war fears – Q & A

(AMP Capital)
12 April 2018

Key points

  • President Trump’s actions on trade are mainly aimed at achieving better access for US exports to China and better treatment of US intellectual property by China. They are not primarily aimed at traditional US allies, reducing the risk of a global trade war.
  • So far there is only a “phoney trade war” between the US and China as major tariffs are only “proposed”. Signs remain positive for a negotiated solution, but there is a way to go yet.


Introduction

Much has been written about the trade dispute between the US and China and the risk of a global trade war. Much of it has been hyperbole but financial markets have had to price in the risks of a full-blown trade war zapping global growth. This has been difficult given almost daily developments on the issue since early March. This note takes a simple Q & A approach to the key issues.


What is a trade war?

A trade war is a situation where countries raise barriers to trade with each other (such as tariffs or quotas on imports or subsidies to domestic industries) usually motivated by a desire to “protect’ domestic jobs and workers sometimes overlaid with “national security” motivations. To be a “trade war” the barriers needs to be significant in terms of their size and the proportion of imports covered. Tariffs on a few goods don’t really count as a trade war because it’s not significant.

The best known global trade war was that of 1930 where average 20% tariff hikes on most US imports under Smoot-Hawley legislation led to retaliation by other countries and contributed to a collapse in world trade.


What is wrong with protectionism?

A basic concept in economics is comparative advantage: that if Country A and B are both equally good at making Product X but Country B is best at making Product Y then they will be best off if A makes X and B makes Y. Put simply free trade leads to higher living standards and lower prices whereas restrictions on trade lead to lower living standards and higher prices. This is why economics should be compulsory in final years at high school!

The trade war of the early 1930s is one factor – along with wrong-footed monetary and fiscal policy – that contributed to the severity of The Great Depression.

A few years ago, at a presentation in Adelaide I tried to explain all this to a woman in the audience who was incensed by the recent closure of auto production in South Australia by Mitsubishi. After a while someone else in the audience asked for a show of hands as to who drives an Australian-made car – only about five hands went up including mine (the Holden!) but most people’s hands stayed down, including the lady’s and she said she liked the safety of a Volvo. Fair enough. But it seems that while some want to protect local industry they don’t buy it themselves. The experience of heavily protecting Australian industry in the post WW2 period was that it was just leading to higher costs and prices and lower quality products and Australians’ were voting with their wallets to buy better value foreign made goods. We might have protected lots of manufacturing jobs if we stayed at the levels of protection of 45 years ago, but we would have become a museum piece as would the US.

Fortunately, despite the loss of jobs in manufacturing (from 25% of the workforce in 1960 to around 8% now) other jobs have come along in the services sector where Australia’s and America’s relatively highly-skilled but highly-paid workforce have a comparative advantage compared to workers in less developed countries.

In short, if you want to support your country’s products buy them, but trade barriers don’t work.


Why is President Trump raising tariffs then?

It’s simple. He is fulfilling a 2016 presidential campaign commitment to “protect” American workers from what he regards as unfair trading practices. He has long held this view – see his 1986 interview with Oprah where his focus was Japan. Last year his focus was on deregulation and tax reform, which helped share markets. This year the November mid-term elections are approaching & polling not helped by his poor popularity has been pointing to the Republicans losing control of the House, so he is back in campaign mode returning to his campaign commitments on trade, knowing tariffs are popular with his supporters.


What does President Trump want?

President Trump wants better access for US exports to China. While it’s been feared at times that Trump was willing to get into trade wars with any country that the US has a trade deficit with, including long time US allies – with criticism of Europe and Germany on the trade front and regular threats to tear up the South Korea/US free trade deal (KORUS) and NAFTA, and US aluminium and steel tariffs originally thought to apply to all countries, it’s clear the main focus is China:

  • Europe has been exempted for now from US tariffs on aluminium and steel (along with most US allies).
  • KORUS has been renegotiated with only minor concessions to the US (on steel and cars with a focus on reducing non-tariff trade barriers); and
  • The NAFTA free trade deal with Mexico and Canada looks on track to be renegotiated.

So maybe Trump is not so blindly protectionist as feared. Basically, the US under Trump feels that China is not giving its exports fair access and alleges – after a review under section 301 of the US Trade Act – that it’s not respecting the US’s intellectual property.


Where are we now?

Fears of a global trade war were kicked off in early March with Trump’s announcement of a 10% tariff on aluminium imports and a 25% tariff on steel imports. US allies were subsequently exempted but China was not, and it announced similar tariffs on roughly $US4bn of imports from the US matching the US tariffs. So tit for tat. But tariffs on $US4bn of imports are trivial – less than 0.1% of US imports for example.Fears of a global trade war were kicked off in early March with Trump’s announcement of a 10% tariff on aluminium imports and a 25% tariff on steel imports. US allies were subsequently exempted but China was not, and it announced similar tariffs on roughly $US4bn of imports from the US matching the US tariffs. So tit for tat. But tariffs on $US4bn of imports are trivial – less than 0.1% of US imports for example.

The focus then shifted to China. On March 22 in response to the Section 301 intellectual property review, Trump announced 25% tariffs on $US50bn of US imports from China with the details announced two weeks later but to be subject to a period of comment before “proposed” implementation in late May/early June. At the same time the US lodged a case against China with the World Trade Organisation, providing confidence Trump is not trying to undermine the global trading system.

China then announced “plans” for 25% tariffs on $US50bn of imports from the US with a focus on agricultural products. So more tit for tat – but in this case only in relation to proposals or plans. And still only small at around 1.5% of US imports, implying an average tariff increase across all US imports of just 0.4%.

To appear to stand up for American farmers, President Trump announced that the US would consider tariffs on another $US100bn of imports from China. China indicated it would again announce a proportional response should the US do so. So fears started to rise of an escalation. But again, it’s all proposals.

On March 22 Trump asked the US Treasury to consider restrictions on Chinese investment in the US by May 21.


What is the most likely outcome?

So far what we have really seen is not a trade war but a phoney trade war between the US and China. The tit for tat tariffs triggered in relation to US steel and aluminium imports are trivial in size. All the other tariffs are just proposals, contingent on the US and China being unsuccessful in reaching a negotiated solution. Our view is that a negotiated solution will head off their implementation, indefinitely delay them contingent on trade success or result in very watered-down tariffs:

  • President Xi Jinping’s speech at the Boao Forum committing to lower import tariffs for various products, increased market access for foreign investors and strengthened protection of intellectual property rights echoes comments by Premier Li and indicates that China is aware of the issues and willing to negotiate. PBOC Governor Yi has added more detail in relation to making it easier for foreign participation in the Chinese financial system and indicated the China will not manipulate a Renminbi depreciation in the trade conflict. So it’s a good first step.
  • Similarly, while President Trump wants to be seen to “stand tough for American workers” a full blown escalation into a real trade war with China come the November mid-term elections is not in his interest as it would mean higher prices at Walmart and hits to US agricultural exports both of which will hurt his base and a much lower US share market which he has regarded as a barometer of his success.

Reaching a deal with China will be harder than “fixing” KORUS and NAFTA and there is a long way to go with setbacks inevitable, but ultimately a deal is likely.


Will all this really fix the US trade deficit?

No. The real issue is that America as a nation spends more than it earns which results in it importing more than it exports. The only way to solve this is for it to save more but the now rising US budget deficit due to tax cuts and spending hikes will mean it will save less. So while a deal with China may reduce the US trade deficit with China the trade deficit will simply shift to other countries.


What to watch?

Key to watch for is negotiation between the US and China on trade. Meanwhile, the US Trade Representative will hold hearings on its proposed US tariffs on $US50bn of imports from China on April 23, these tariffs “if any” are due to be finalised by May 21 and the US Treasury is due to propose restrictions on Chinese investment in the US by May 21 – but both could be delayed if negotiations are ongoing. May 1 will also see exemptions to the US’s steel and aluminium tariffs expire if they are not renewed.


What would be the impact of a full-on trade war?

The negative economic impact from a full-blown trade war would come from reduced trade and the disruption to supply chains that this would cause. This is always a bit hard to model reliably. Modelling by Citigroup of a 10% tariff hike by the US, China and Europe showed a 2% hit to global GDP after one year with Australia seeing a 0.5% hit to GDP reflecting its lower trade exposure compared to many other countries, particularly in Asia which will face supply chain disruption. But of course we are currently nowhere near a 10% average tariff hike. And the current situation really just involves the US and China so arguably Chinese and US goods flowing to each other could – to the extent that there are substitutes – just be swapped for goods coming from countries not subject to tariffs thereby reducing the impact.


Why have share markets fallen?

A full-blown trade war would depress global growth so share markets have moved to make some allowance for the probability of this. If a trade war is averted, even though we may not have trade peace, share markets will be able to unwind this, albeit volatility will still remain high given other issues such as Fed tightening and ongoing risks around President Trump.

Important note: While every care has been taken in the preparation of this article, AMP Capital Investors Limited (ABN 59 001 777 591, AFSL 232497) and AMP Capital Funds Management Limited (ABN 15 159 557 721, AFSL 426455) makes no representations or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. Past performance is not a reliable indicator of future performance. This article has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. An investor should, before making any investment decisions, consider the appropriateness of the information in this article, and seek professional advice, having regard to the investor’s objectives, financial situation and needs. This article is solely for the use of the party to whom it is provided.

 

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Australians on Easter egg hunts this weekend might uncover parts of a Chinese spacecraft

Luke Costin
(Australian Associated Press)

 

Australians on Easter egg hunts this weekend might uncover parts of a Chinese spacecraft – but the chances are slim.

One of the world’s few space stations, Tiangong-1 or Heavenly Palace 1, is predicted to end its uncontrolled 450km-per-minute orbit of Earth and re-enter the atmosphere sometime between Friday and Tuesday.

It’s difficult to calculate where parts of the spacecraft could crash into Earth, experts say.

The fuel tank is likely made of titanium, giving it a chance of making it back to Earth.

But given its speed and other factors, crash sites include everywhere between the latitude of 43 degrees north and south – spanning an area stretching from southern France to Hobart.

So chances are slim it will land in a populated area, let alone hit anyone.

“Anything is always possible but it’s just highly unlikely that this one fuel tank that may or may not survive is going to slam into someone’s house or into someone,” Flinders University space archaeologist Alice Gorman told AAP.

“The thing that would be really nice, if it re-enters over Australia at night, is that we’ll get to see a spectacular sight of the spacecraft breaking up and lighting up as it comes in like a meteor shower.”

The temperature and density of different parts of the atmosphere, the Sun’s activity and what parts are facing Earth will all come into play.

But not knowing the components of Tiangong-1 makes estimating the danger more challenging, Swinburne University astronomer Alan Duffy said.

“China’s secrecy around this nationally significant space mission has meant that the international community doesn’t know what the craft is made of,” Mr Duffy said.

While space junk falls back to Earth every day, this bus-sized unit has garnered more interest for a few reasons.

Tiangong-1 featured in 2013 sci-fi thriller Gravity, starring Sandra Bullock, and was briefly the home of China’s first two female astronauts, Liu Yang and Wang Yaping.

It’s also been out of control for two years – a fact China only acknowledged publicly last May.

But even if it falls on Australian land, a United Nations agreement means any part of Tiangong-1 remains the property of China.

That also ensures China is liable for any damage.

Space lawyer Kim Ellis said it would mean the federal government could present a claim for damage to China should Tiangong-1 collide with and damage a satellite from Australia or damage people or property within Australia.

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Businesses promise to invest after tax cut

Colin Brinsden and Angus Livingston
(Australian Associated Press)

 

Some of Australia’s largest businesses are promising to “invest” and therefore lift wages if crossbench senators agree to pass company tax cuts.

Independent senator Steve Martin revealed on Wednesday he would back the government’s planned corporate tax cuts, but Pauline Hanson and Derryn Hinch want businesses to promise wage growth.

So the Business Council of Australia on Wednesday released a joint statement with the heads of large companies calling for the Senate to act.

“If the Senate passes this important legislation we, as some of the nation’s largest employers, commit to invest more in Australia which will lead to employing more Australians and therefore stronger wage growth as the tax cut takes effect,” the statement said.

But on Twitter, Senator Hinch said the promise – from the heads of BHP, Qantas, Fortescue, Wesfarmers and EnergyAustralia among others – wasn’t enough to secure his vote.

The government is trying to get the crossbench numbers it needs to pass the bill, which will reduce the company tax rate incrementally over the next decade to 25 per cent for all businesses.

Prime Minister Malcolm Turnbull insisted the “vitally important” tax cuts would provide the incentive for businesses to invest and employ.

“The US have gone to 21 per cent – we have to have a competitive company tax,” he told reporters in Port Macquarie.

Senator Martin said his decision to back the cuts achieved the best deal for Tasmania, strengthening its global export markets, bolstering job creation and wages growth.

Finance Minister Mathias Cormann tweeted his thanks to Senator Martin.

“Your vote will help all Australian businesses to successfully compete, to grow, to hire more Australians and pay them better wages,” he said.

But research commissioned by lobby group GetUp! found 37 per cent of the corporate tax cut would immediately flow offshore.

GetUp! says at least $1.96 billion of the $5.2 billion annual value of the corporate tax cut will flow directly offshore each year.

The government needs support from nine of the 11 crossbenchers to pass the bill, with Labor and the Greens restating their opposition to the $65 billion package during the early stages of the debate.

Labor senator Murray Watt said the debate is happening in the same week the government is taking money from low-income people through its welfare reforms.

“How on earth can any of those crossbenchers be voting for a $65 billion tax cut for big business?” he told reporters in Canberra.

While Senator Hinch and Senator Hanson want guarantees from companies, Workplace Minister Craig Laundy is no fan of government telling businesses what they can or cannot do.

“I can’t see how (requiring a wages guarantee) would be practical and enforceable and measurable,” he told ABC radio.

Debate is expected to continue in the Senate on Wednesday night.

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Tech baron warns of massive job disruption

Matt Coughlan
(Australian Associated Press)

 

Tech billionaire Mike Cannon-Brookes has urged governments to plan for massive job disruption because of rising automation, warning Australia faces a “painful” transition.

The co-founder of software giant Atlassian says there’ll be major upheaval in the local workforce.

“I hate being Chicken Little and trying to scare people but it seems to be the only way to get action – there will be massive job disruption,” Mr Cannon-Brookes told a Senate inquiry on Tuesday.

While many new jobs will be created by technology, people who lose jobs in other sectors do not face a smooth transition, he said.

Mr Cannon-Brookes says Australia faces the major challenges of upskilling workers, making education a life-long process, ensuring post-disruption employment is created locally and providing support to people who lose their jobs.

“This time we know what’s coming. I think we must act and act soon,” he said.

“This is not science-fiction.”

Mr Cannon-Brookes, who Forbes estimated to have a fortune of $US3.4 billion last week, also had a warning for the retail sector.

“The head-in-the-sand attitude of Australian businesses scares me a lot,” he said.

“Amazon is going to tear apart Australian retail as they did in the US.”

Mr Cannon-Brookes believes Australia is capable of building a world-class technology industry and skills to manage disruption.

But as it stands, many graduates are being lost to US-based tech giants contributing to a digital skills shortage in Australia.

“Try telling a 21-year-old kid that’s going to work for Google or Amazon or Facebook that we have lots of opportunity for them in Sydney or Melbourne – it’s hard,” he said.

The Senate committee investigating the future of Australian workers is in Melbourne on Tuesday hearing evidence from unions, industry groups and think-tanks.

Read it on Apple news

Weak wages risk to budget outlook: IMF

Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)

 

Weak wages growth is threatening the Turnbull government’s forecast for a budget surplus in mid-2021, the International Monetary Fund warns.

The Washington-based institution’s final version of its annual appraisal of Australia’s prospect predicts a further pick-up in economic growth.

But it also sees wages growth at a sub-three per cent, which is below the government’s more optimistic estimate of around 3.5 per cent.

Wages grew by 2.1 per cent over the 2017 calendar year – still close to a 20-year low – Australian Bureau of Statistic figures released on Wednesday showed.

The IMF’s Thomas Helbling, who led a delegation to Australia last year, said corporate income tax revenues were higher-than-expected, largely on the back of stronger commodity prices.

But lower wage and household income growth were a concern.

“There is some risk to achieving the surplus,” Dr Helbling told reporters.

The IMF is predicting the economy will grow by 2.9 per cent this year and 3.1 per cent in 2019, after an estimated 2.2 per cent in 2017.

The gradual acceleration in growth should return the economy to full employment – estimated at around five per cent – by 2020.

A strengthening global economy and domestic infrastructure investment would boost economic growth, while mining investment was bottoming out and would no longer subtract from growth.

Treasurer Scott Morrison said the Turnbull government was sticking to its plan that will continue to support the economy in its transition to broader-based growth.

“It is a plan that is already delivering record jobs growth, and creating the conditions to support stronger wages growth, and putting more money in the pockets of hard-working Australians,” he said in a statement.

Even so, the IMF doesn’t expect inflation to return to the mid-point of the Reserve Bank’s two to three per cent target band until 2021.

As such, Dr Helbling believes cash interest rate settings are appropriate and should “remain supportive” for the economy.

The central bank’s key interest rate has remained at a record low 1.5 per cent since August 2016.

The recent cooling of the housing market was consistent with a “soft landing”, rather than the crash that some have feared, Dr Helbing said.

However, this was happening at a time of high household indebtedness and could lead to consumers being more cautious in their spending habits.

More broadly, there are upside risks to the outlook from a stronger global backdrop and increased infrastructure spending, which could lead to a larger pick-up in non-mining business investment than presently expected.

 

IMF’S KEY ECONOMIC FORECASTS FOR AUSTRALIA

GDP

2018 – 2.9 per cent

2019 – 3.1


UNEMPLOYMENT

2018 – 5.3 per cent

2019 – 5.2


WAGES

2018 – 2.3 per cent

2019 – 2.3


INFLATION

2018 – 2.1 per cent

2019 – 2.2

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Benchmark your marketing and client communications here …

How do your marketing and client communication goals, dreams and current barriers compare with others in your sector?

Join others in our community who have completed our quick six question survey.

Once compiled, you will receive our 2018 Marketing Report FREE for you to benchmark your business.

 

CLICK SURVEY HERE (3:58 MINS)

 

There is also another side to this.

We are currently mapping out new tools and free info and tips to help make marketing even easier for small businesses – like yours.

For us to do that, we want to learn more about you.

We’d really value your input in this important 3:58 minute survey.

Why 3:58 minutes?

Well, that’s been the average time for your colleagues to complete the survey so far.

 

CLICK SURVEY HERE (3:58 MINS)

 

And as a bonus, you will also be invited to benchmark the performance of your Facebook Page with a FREE audit and report.

We’ll use your feedback to come up with specific topics we write about on our blog, share in our webinars and develop in our products.

Thanks in advance for taking the time to provide your input.

 

 

Gavin, Steve and the Feedsy Team

Add a fresh row of stories to your website [new product]

Over the years Feedsy has had many clients ask whether it is possible to make their own websites more dynamic by adding a news feed.

Well, a feed of their Feedsy stories to be exact.

Some have paid a developer to code up a solution for them whilst others have been patiently waiting for Feedsy to release a low cost, no fuss solution that works seamlessly with their FeedsyWeb content.

Well, the wait is over!

 

FeedsyRow is here.

 

Initially for WordPress sites only, Feedsy can install a row of 4 most recent articles on your home page or any suitable page.

There are a choice of customisations including only displaying a single story category (eg your own “Blog” articles).

But if choice is too hard then the default settings will still make your site look alive and current.

FeedsyRow is a great way to generate more traffic between your site and your news FeedsyWeb site (which Google loves).

 

Pricing:

  • There is a small set-up fee of $275
    But is $0 with all full Feedsy Web+Mail+Social and Apps+Mail+Web plans.
  • A tiny monthly fee of $22pm.

 

CLICK HERE to find out more.

 

What do you think? We’d love your FEEDBACK.

 

Gavin and the Feedsy Team!

Aussie dollar eases local petrol pump pain

Christian Edwards
(Australian Associated Press)

 

Stiff resistance from the Australian dollar is helping keep a cap on rising petrol pump prices as New Year holiday travellers hit the roads.

Aussie motorists now pay, on average, 10 cents a litre more when they fill up with petrol compared to this time last year when they forked out $1.25 a litre, on average.

CommSec estimating an Aussie family pumps around $229 every month into the family car, $25 more when compared to this time in 2017.

But, CommSec chief economist Craig James says, it could have been far worse – if the Australian dollar had fallen rather than risen in the past 12 months.

He said a falling Australian dollar would have made imports of oil, which is priced in US dollars, more expensive, but thankfully the local currency had lifted from 72 US cents to 78 US cents in 2017.

The currency gain had offset the rise in oil prices brought about by OPEC-led production restrictions to tackle a global oversupply.

In 2017, the Nymax price of crude oil jumped 12.5 per cent, with Brent leaping 17 per cent.

Brent, at 1410 AEDT on Tuesday, was just above $US67 a barrel, while West Texas Intermediary (WTI, or US) was approaching $US61.

“There are no signs as yet of a softening of oil prices, but a firm Aussie dollar is serving to restrain pump prices for local motorists,” Mr James said in a statement on Tuesday.

On Tuesday, the Australian terminal gate, or wholesale, price for petrol stood at 123.3 cents a litre after hitting a six-week low of 123.0 cents a litre last Thursday.

Mr James said that Sydney and Adelaide pump prices were nearing the lows in their current discounting cycle, while Melbourne and Brisbane prices “still have some way to go to”.

Read it on Apple news

Critical need for Christmas blood donors

Sarah Wiedersehn
(Australian Associated Press)

 

Australians are being urged to give blood this Christmas, with supplies at risk of running critically low.

With many regular blood donors taking a break over the festive season, the Australian Red Cross Blood Service is in desperate need of 4,000 donors.

At particular risk are supplies of platelets – the clotting component of blood that is largely relied on by cancer patients to prevent internal bleeding.

Platelets only have a shelf life of five days, so a constant flow of donors is required, even during holiday times.

“The period between Christmas and the New Year is when platelet stocks are most at risk,” warned Blood Service spokeswoman Jemma Falkenmire.

“Cancer patients are the biggest users of donated blood in Australia; it’s critical to helping them through chemotherapy,” Ms Falkenmire said.

“With one in three of us needing donated blood in our lifetime, the life you help save this festive season could even be that of a loved one.”

People are being urged to make an appointment to give blood between Boxing Day and New Year’s Eve.

To learn more about becoming a donor this Christmas and New Year visit donateblood.com.au or call 13 14 95.

Read it on Apple news

[VIDEO] A Feedsy merry Christmas and 2018 insights

 

On behalf of our Feedsy team, Gavin and Steve would like to wish you a very safe and happy festive season; we trust you enjoy this time with your friends and family, after-all that’s what life is all about.

We have been working with our Feedsy client advisory board this year to deliver some new ideas and innovative product solutions in 2018, so stay tuned 🙂

As you know we are not able to catch up face to face on a regular basis, so we are about to change that with the introduction of a face to face Feedsy masterclass and regular webinars in 2018. We want to help you use Feedsy better, plus have the opportunity to share a coffee with you.

If you have a great local venue near you or think our masterclass sounds like a great idea, we would love your thoughts.


Merry Christmas!

from your Feedsy team

 

 

 

Williams covets another Cup with Almandin

Megan Neil
(Australian Associated Press)

 

Lloyd Williams has already won a record five Melbourne Cups but would dearly love to add to the history books by making it back-to-back wins with Almandin.

Team Williams has an interest in a quarter of the runners in Tuesday’s $6 million race, led by the favourite Almandin.

Williams’ son Nick says Almandin is in great form, relishing the prospect of the gelding becoming only the sixth horse to win the Melbourne Cup more than once.

“If I could pick who I would love to win it would be Almandin, but that’s because we love this race,” Williams said on Sunday.

“We have a great sense of history. We’re proud Melburnians, and to have the honour of having a back-to-back winner would mean a great deal to us.

“So that’s my heart speaking as opposed to probably speaking objectively.

“But I couldn’t put a negative on Almandin.”

Superstar jockey Frankie Dettori desperately wants Almandin to add a Melbourne Cup to his CV.

Dettori won Europe’s biggest race the Prix de l’Arc de Triomphe for a record fifth time a month ago.

But the former long-time number one rider for global racing powerhouse Godolphin has yet to win a Melbourne Cup, despite 15 attempts over 24 years.

“We’re really thrilled to have him on board,” Williams said.

“He’s a great friend.

“Apart from that, he’s the best jockey in the world so it’s not a bad start.”

Half the Team Williams runners in the Cup – Almandin, Bondi Beach and Gallante – are trained by Robert Hickmott in Victoria.

The three overseas-trained Williams runners will pit father against son as champion Irish trainer Aidan O’Brien seeks his first Cup with Johannes Vermeer while son Joseph has US Army Ranger and Rekindling.

They are among a record-equalling 11 overseas-trained horses in this year’s Cup.

Iain Jardine has the hopes of Scotland resting on him and his Ebor Handicap winner Nakeeta, the first Scottish-trained horse to run in a Melbourne Cup.

“There’s a lot of people rooting for us back home,” he said.

“It’s great, absolutely fantastic.”

New Zealand’s Cup hopes were dashed when Jon Snow was ruled out of the race.

Who Shot Thebarman’s Kiwi owners had planned to bring a big entourage with them to Flemington but the Chris Waller-trained nine-year-old was scratched on Sunday, ending his bid for history as the oldest Melbourne Cup winner.

Another former Kiwi-trained horse Humidor joins Big Duke and Amelie’s Star in the race for Victorian trainer Darren Weir, who won the 2015 Cup with Prince of Penzance.

New Zealand-bred gelding Cismontane is racing for trainers Gai Waterhouse, who won in 2013, and Adrian Bott.

Amelie’s Star and Single Gaze are the only two mares in the race, with the latter to be guided by the only woman rider, Kathy O’Hara.

Single Gaze’s Canberra trainer Nick Olive is not letting the hype of his first Melbourne Cup get to him.

“I’m sure on Tuesday it will probably hit me, the gravity of it all, but it’s just been good fun and the horse is well.”

Read it on Apple news