Overnight, the Federal Treasure, the Hon. Scott Morrison MP handed down the Federal Budget and it is nice to be writing this column this year with a smile on my face and not feeling deflated and sad. The budget has got some small elements that may have a positive impact on the outbound travel industry and this comes in two parts.
The first is the $10 per week tax cuts for middle income earners and it is possible as this is implemented that some of this win fall will flow to the travel industry. You may recall when a previous federal government handed out $500 - $900 bonus during the financial crisis that the travel industry and the odd flat screen TV become the way people direct some of these funds. We shall see how this goes.
The second is the indication that the government is on travel to be back into surplus by 2020-2021 or possibly sooner. This is a good sign for the Australian Economy and will in the end allow the Government to consider further tax cuts and remain committed to the company tax rate reduction that is also looking more likely to be confirmed. All positive settings for the Australian travel industry.
The other great thing is that the commitment that was made to freeze the Passenger Movement Charge as an outcome of the bun fight the industry had with the government over the working holiday makers new tax, has been upheld with no change, in fact no real mention of the PMC which is a really nice change.
And, being positive, an allocation of an additional $5.1 million to Tourism Australia (TA) which will be very welcomed by TA and the Tourism Industry as the government put back some of what they took out last year. It is always easy to forget what has been taken and celebrate what is given, but it is equally important to keep track on the overall balance and as Federal funding goes.
TA is still really in need of more so that it can do more. As China becomes more and more the primary source of inbound tourists, a strategic approach to a more diverse and flexible mix of inbound source markets is needed and that requires commitment and continued funding to TA.
But, overall a good budget in what is clearly a pre-election budget so get ready for that to become the thing that we will all be talking about soon.