State faces higher taxes: BankSA report
Tuesday, 25 June 2013
Author: Kevin Naughton, Indaily
Economic recovery hasn't been matched by revenue growth putting pressure on state governments to raise taxes, says the latest BankSA economic bulletin.
The soft revenue growth hasn't kept pace with demand for services, the bank's CEO Jane Kittel said today.
"The impacts of a deteriorating Budget will be many and the State Government will be under increasing pressure to deliver services and infrastructure from its own tax base," she said.
"The State's industry faces the prospects of less financial support, while both individuals and producers in the State may be hit with higher taxes."
The latest edition of BankSA's Trends economic bulletin examines the longer term implications of an Australian economy that is now less 'tax friendly' than it was prior to the Global Financial Crisis.
The BankSA report, compiled in conjunction with Deloitte Access Economics, explores this impact on the national as well as the South Australian economies.
Kittel said the report shows that the economic recovery since the GFC hasn't seen a matching recovery in revenues, and that has left the Budget in some degree of trouble.
"At $370 billion, the Budget comprises around one quarter of Australia's economy," she said.
"The two most important priorities of the nation are reflected in our Budget - our taxes and our spending - and both have significant impacts on national prosperity."
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