Trade and Assistance Review 2008-09
Key points
Issued with Trade and Assistance Review 2008-09 on 22 June 2010.
See also
- Government assistance to industry is provided by tariffs, budgetary outlays, taxation concessions, regulatory restrictions on competition and other measures.
- Assistance generally benefits the industry receiving it, but can come at a cost to other industries, taxpayers and consumers.
- Some assistance programs such as those relating to R&D and environmental objectives, can deliver net community benefits if they are well designed and effectively implemented.
- For 2008 09, total measured assistance to industries was $17.2 billion in gross terms and $9.0 billion in net terms.
- It comprised $9.5 billion in output tariff assistance, $3.7 billion of budgetary outlays and $4.0 billion in tax concessions.
- The cost impost on industries of import tariffs amounted to $8.1 billion.
- Since May 2009, the Australian Government has announced industry assistance budget outlays of at least $6.2 billion, mostly to be expended over the next five years.
- The bulk of the proposed expenditure ($4.6 billion) relates to carbon emission reduction and energy programs.
- The remainder (around $1.5 billion) relates to 'traditional' forms of Government support to industry, exports, research and development and innovation.
- The structure and performance of the Australian finance sector is shaped by a variety of government policy measures, including recent global financial crisis-related measures. Budgetary measures relating to the sector are largely tax concessions.
- Finance sector-specific taxation concessions are estimated at $330 million for 2008 09 and are largely intended to promote Australia as a financial services centre.
- Superannuation taxation concessions advantage complying superannuation savings vehicles and incidentally advantage superannuation service providers.
- The GST treatment of financial supplies (input taxing) also confers a sizeable incidental benefit to the finance sector (estimated at $2.8 billion in 2008 09).
- While Government support introduced in response to the financial crisis was temporary and is now being progressively withdrawn, it is likely to have some enduring effects.
- Despite efforts to bring about a successful conclusion to the Doha Round of trade talks, little progress was achieved in 2009 and early 2010 and prospects remain uncertain.
| Paul Gretton (Assistant Commissioner) 02 6240 3252 |