Statement 4: Revenue
Since the 2014‑15 Budget, the forecast for nominal GDP has been revised down significantly by around $172 billion over the four years to 2017‑18, which has weakened the outlook for tax receipts. The 2015‑16 Budget forecasts for tax receipts, excluding new policy, have been downgraded since the 2014‑15 Budget by $14.0 billion in 2015‑16 and $51.7 billion over the four years to 2017‑18. Excluding GST, tax receipts variations are forecast to be $14.1 billion lower in 2015‑16 and $51.9 billion lower over the four years to 2017‑18.
The decline in the price of iron ore accounts for around $20 billion of this write‑down. While most of this downgrade is from taxes paid by mining companies there are also effects on taxes paid by other businesses, taxes on wages and other sources of revenue. Weaker expected wage growth is expected to lead to lower taxes from individuals of $16.4 billion over the four years to 2017‑18.
Since the 2014‑15 MYEFO, forecast tax receipts have been downgraded by $5.9 billion in 2015‑16 and $20.1 billion over the four years to 2017‑18, driven by downgrades to forecasts for nominal GDP totalling around $63 billion over the four years to 2017‑18.
Downgrades in forecast tax receipts since the 2013 Pre‑Election Economic and Fiscal Outlook are estimated to have totalled over $90 billion across the forward years.
Total tax receipts as a per cent of GDP are expected to be 22.3 per cent in 2015‑16, slightly lower than estimated at the 2014‑15 Budget at 22.5 per cent.