The revenue estimates are constructed using the outcomes for 2009‑10, information on the 2010‑11 year‑to‑date revenue collections, and the latest economic forecasts for 2010‑11 to 2012‑13. Revenue estimates for the projection years (2013‑14 and 2014‑15) are based mainly on underlying trends in economic parameters.
In 2010‑11, total revenue is forecast to grow by 6.2 per cent ($18.0 billion) on the back of growth in personal income and company taxes.
In 2011‑12, further growth of 12.6 per cent ($39.2 billion) in total revenue is expected. This is driven by 10.4 per cent ($13.6 billion) growth in income withholding tax revenue and a 28.9 per cent ($16.7 billion) growth in company tax revenue. Indirect taxation revenue is expected to grow by 5.2 per cent ($4.4 billion).
Individuals' income and other withholding taxation revenue
Table 8: Individuals' income and other withholding taxation revenue
Gross income tax withholding
Revenue from gross income tax withholding is expected to grow by 9.5 per cent ($11.4 billion) in 2010‑11, reflecting solid growth in employment and wages in the aftermath of the global financial crisis.
In 2011‑12 and 2012‑13, income tax withholding is expected to increase by 10.4 per cent ($13.6 billion) and 8.3 per cent ($12.0 billion) respectively. This reflects anticipated growth in employment and wages as the labour market moves towards full capacity.
In the projection years, revenue from income tax withholding is expected to grow by 7.7 per cent in 2013‑14 and 7.2 per cent in 2014‑15, as employment and wage growth return to their long‑term trends.
See Table 9 for personal income tax rates.
Gross other individuals
Gross revenue from other individuals is expected to grow by 9.4 per cent ($2.6 billion) in 2010‑11, reflecting growth in unincorporated business income, and interest and dividend income.
In 2011‑12, revenue from other individuals is expected to grow 11.7 per cent ($3.5 billion), followed by growth of 15.9 per cent ($5.3 billion) in 2012‑13. This reflects accelerated growth in tax instalments from unincorporated business income and growth in net capital gains and interest income.
In the projection years, revenue from other individuals is expected to grow by 8.3 per cent and 9.1 per cent in 2013‑14 and 2014‑15 respectively, reflecting a return to longer term trend growth rates.
Income tax refunds for individuals
Refunds for individuals, which have a negative impact on revenue, are expected to grow by 1.9 per cent ($460 million) in 2010‑11, reflecting a modest strengthening in the labour market and personal income tax cuts delivered in 2009‑10.
Refunds for individuals are expected to grow by 10.3 per cent ($2.6 billion) in 2011‑12, reflecting growth in salary and wages and continued use of capital losses sustained during the global financial crisis. The lower growth of 2.2 per cent ($600 million) in 2012‑13 is primarily due to the bring‑forward of the low‑income tax offset.
In the projection years, refunds for individuals are expected to grow by 10.4 per cent and 9.2 per cent in 2013‑14 and 2014‑15 respectively, largely reflecting the growth in individuals' income tax payments over the same period.
Fringe benefits tax
Revenue from fringe benefits tax (FBT) is expected to grow by 4.2 per cent ($150 million) in 2010‑11 relative to the 2009‑10 outcome, reflecting wages and employment growth.
In 2011‑12 FBT is expected to grow by 2.5 per cent ($90 million), reflecting moderate growth in non‑cash wages. From 2012‑13, growth in FBT is affected by the impact of new policy related to the treatment of FBT on cars.
Table 9: Personal income tax rates(a)
- This table includes legislated changes to tax rates and thresholds, excluding temporary changes including the Temporary Flood and Cyclone Reconstruction Levy in 2011‑12.
Company and other related income taxation revenue
Table 10: Company and other related income taxation revenue
- Resource rent taxes include Petroleum Resource Rent Tax (PRRT) and gross receipts from the Minerals Resource Rent Tax (MRRT) from 2012‑13.
Losses associated with the global financial crisis, the impact of the natural disasters, and the stronger dollar all worked against a strong recovery in company tax revenue from its low point in 2009‑10. Company tax revenue is now expected to grow by 8.8 per cent ($4.7 billion) in 2010‑11.
In 2011‑12, company tax revenue is projected to grow by 28.9 per cent ($16.7 billion). Not only are the factors that influenced growth in 2010‑11, while still prevalent, anticipated to unwind gradually, but timing effects within the tax system are also expected to contribute to the high growth rate in 2011‑12. Firstly, the strongest sector of the economy — mining — largely operates on a calendar year basis, resulting in tax payments appearing earlier than for companies which operate on a financial year ending in June. Secondly, low instalment rates through the 2010‑11 income year mean that tax from increased growth in corporate profits will generate higher payments on assessment in 2011‑12. These effects were discussed in more detail in Box 1, Part 3, 2009‑10 MYEFO.
In addition, several measures from previous budgets increase revenue in 2011‑12. These include the unwinding of the small and general business tax break, the research and development tax credit and gains associated with increased Australian Taxation Office compliance activities.
In 2012‑13, company tax revenues are expected to grow by around 4.7 per cent ($3.5 billion), reflecting the unwinding of instalment rate effects.
Over the projection years, revenue from company tax is expected to grow by 2.8 per cent in 2013‑14 and 3.9 per cent in 2014‑15. Growth in company tax revenue over these years is moderated to some degree by the continued utilisation of prior year losses but also deductions related to capital investment expenditures in the mining sector.
Following falls of 23 per cent in 2008‑09 and 33 per cent in 2009‑10, revenue from superannuation funds is expected to increase by around 16.8 per cent in 2010‑11, 29.3 per cent in 2011‑12 and 12.4 per cent in 2012‑13. The ongoing recovery from the global financial crisis is tempered by the utilisation of capital losses.
In the projection years, revenue from superannuation funds is affected by the utilisation of capital losses as well as the reclassification of the Low Income Earner's Superannuation Co‑Contribution program from revenues to expenses (see Table 9.2 in Budget Statement 6).
Resource rent taxes
Resource rent taxes include Petroleum Resource Rent Tax (PRRT) and the Minerals Resource Rent Tax (MRRT — to be introduced in 2012‑13). They are a highly variable source of revenue as they are heavily influenced by commodity prices and exchange rate levels.
Revenue from PRRT is expected to decline by 27.5 per cent ($360 million) in 2010‑11. The fall reflects higher investment costs (which increase tax deductions) associated with some fields.
In 2011‑12 revenue from resource rent taxes is expected to grow by 118 per cent ($1.1 billion), reflecting strength in oil prices.
In 2012‑13, revenue from resource rent taxes is expected to grow by 295 per cent ($6.0 billion) largely reflecting the MRRT commencing in 2012‑13.
In the projection years, revenue from resource rent taxes is expected to grow by 9.6 per cent in 2013‑14, but decline by 17.6 per cent in 2014‑15. These changes largely reflect changes in forecast commodity prices and anticipated production trends.
Sales taxation revenue
Table 11: Sales taxation revenue
Goods and services tax
Goods and services tax (GST) revenue is expected to grow by 3.5 per cent ($1.6 billion) in 2010‑11 reflecting a softer outlook for consumption, dwelling investment and ownership transfer costs.
In 2011‑12 and 2012‑13, revenue from GST is expected to grow by 5.1 per cent ($2.5 billion) and by 7.1 per cent ($3.6 billion), in line with the growth in consumption.
In the projection years, GST revenue is expected to grow by around 5.7 per cent in 2013‑14 and 4.9 per cent in 2014‑15, in line with growth in consumption.
Other sales taxes
Other sales taxes include the wine equalisation tax and the luxury car tax.
Wine equalisation tax (WET) revenue is expected to decline by 3.7 per cent ($30 million) in 2010‑11, reflecting subdued alcohol consumption. In 2011‑12 and 2012‑13, WET revenue grows from this lower base by 5.6 per cent ($40 million) and 6.6 per cent ($50 million) respectively in line with general consumption growth. That said, expected growth in 2011‑12 and 2012‑13 is still moderate compared with previous expectations. In the projection years, WET revenue is expected to grow by 3.7 per cent in 2013‑14 and 6.0 per cent in 2014‑15.
Luxury car tax (LCT) revenue is expected to remain flat in 2010‑11 consistent with recent consumption patterns. In 2011‑12 and 2012‑13, LCT revenue is expected to grow by 2.0 per cent ($10 million) and 3.9 per cent ($20 million) respectively. In the projection years, LCT revenue is expected to grow by 5.7 per cent in 2013‑14 and 5.4 per cent in 2014‑15.
Excise and customs duty
Table 12: Excise and customs duty revenue
- The impact of the increase in the tax rate on tobacco products affects both excise and customs duty (reported within the 'excise‑like goods category). The resulting increase in excise duty is largely offset over the forward estimates by the expected offshore relocation of a large tobacco manufacturer, which will then fulfil its tax obligations via customs duty.
- Other excisable beverages are those not exceeding 10 per cent by volume of alcohol.
The Government receives excise duties from a range of sources including alcohol (including beer, spirits and RTDs), petroleum (including diesel, petrol and other fuel products) and tobacco. See Table 13 for excise rates.
Revenue from excise is expected to increase by 6.2 per cent ($1.5 billion) in 2010‑11. This largely reflects the impact of the 25 per cent increase in the tobacco excise rate from 30 April 2010. In 2011‑12 and 2012‑13, excise is expected to increase by 1.0 per cent ($270 million) and 2.2 per cent ($580 million) respectively.
The scheduled relocation overseas of a large tobacco producer is expected to moderate growth in overall excise in the affected years (the relocation is expected to be revenue neutral as it results in a transfer from excise to customs duty — see Customs variation).
In the projection years, excise revenue is expected to rise by 3.5 per cent in 2013‑14 and 4.7 per cent in 2014‑15, broadly reflecting long‑term trend growth rates.
Table 13: Excise rates(a)
- The rate of excise on crude oil and condensate is not provided in this table as it varies according to the quantity sold, the sale price, and the dates of discovery and development of the oil field.
Customs duties are expected to grow by 5.1 per cent ($290 million) in 2010‑11 largely affected by the 25 per cent increase in the tobacco excise rate from 30 April 2010. This is offset in part by a tariff rate reduction for passenger motor vehicles and textiles, clothing and footwear which came into effect on 1 January 2010.
In 2011‑12 and 2012‑13, customs duty revenue is expected to grow by 24.5 per cent ($1.5 billion) and 7.8 per cent ($600 million) respectively. The scheduled relocation of a large tobacco producer is expected to increase growth in overall customs duty.
In the projection years, customs duty revenue is expected to grow by 5.3 per cent in 2013‑14 and 4.3 per cent in 2014‑15.
Table 14: Customs duty tariff rates
- The general tariff of 5 per cent applies to most manufactured goods. Many goods, including primary products, textiles, clothing and footwear and other manufactured goods have free rate of duty.
- This category includes new passenger vehicles and off‑road vehicles and parts. Used or second‑hand vehicles are subject to an additional impost of $12,000.
Other taxation revenue
Table 15: Other taxation revenue
Other taxation revenue is expected to increase by around 4 per cent ($109 million) in 2011‑12.
Table 16: Non‑taxation revenue
Non‑tax revenue is expected to grow by 1.1 per cent ($234 million) in 2011‑12, partly reflecting increases in offshore petroleum royalties resulting from higher prices and increased production.
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