Malcolm Turnbull continues budget battle with banks


"I don't think it is credible for the Coalition side of politics to deliver a tax-and-spend budget", she said.

In addition, bank executives will face tough penalities for misconduct under a Banking Executive Accountability Regime.

The government plans to spend AU$5.3 billion ($3.9 billion) on building a second global airport in Sydney which is due to open in 2016.

Meanwhile Deloitte Access Economics' Chris Richardson said there was some "excellent politics" within the coalition's budget, but was sceptical about the government's promise to return the budget, which is now at 29.4 billion AU dollars (21.6 billion USA dollars) to surplus by 2021. The government also plans an AU$8.4 billion ($6.2 billion), 1,700 kilometer (1,000 mile) new railway corridor between Melbourne, Australia's second largest city, and the third largest city, Brisbane.

Social Services Minister Christian Porter questioned why Labor would support increasing the Medicare levy at all, considering it claims the NDIS was fully funded by Labor.

This accounts for the budget's higher HELP debt repayments and the rise in the Medicare levy from 2 to 2.5 per cent of taxable income.

An increase in the Medicare levy for all Australians, a new tax on the country's five biggest banks, and new measures to crack down on multi-national tax evasion were the centrepiece of Tuesday night's federal budget. But the economy has been sluggish in recent years, following the end of a decade-long, China-fuelled mining boom.

Helping boost the government's pay book over the forward estimates will be the $50 billion increase over the period in annual personal income tax receipts, the $17 billion increase in annual company tax receipts, the $13 billion in cumulative Future Fund earnings, GST annual revenue growing $10 billion and the $4 billion increase in annual superannuation fund taxes.

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The Coalition won the 2016 election, but a year later has delivered a Labor budget.

Government payments are also forecast to fall to 25% of GDP in 2020-21, returning close to the 30 year historical average, he said.

Also proposed is a Medicare levy, rules created to improve the integrity of GST on property transactions, and the introduction of the Skilling Australians Fund levy to ensure that employers of foreign workers are investing in training Australians to meet future skills needs.

Contrary to longstanding rejection by the Government, it has altered negative gearing provisions to bar tax refunds for travel to investment properties, and for removable purchases such as dishwashers.

The Government has also heard the anger over housing prices.

"It is a tax that will hit Australians by hurting investment and could have unintended will affect the entire banking system", said Anna Bligh, the former Queensland premier.

Commentators predicted that measures such as the banks' tax and extra spending on retirees and infrastructure were likely to prove popular.

Slumped in their chairs and looking at their phones, Malcolm Turnbull's front bench looked less than impressed as Bill Shorten gave his Federal Budget Reply.