Fortunity Chartered Accountants and Financial Planners

2019 Budget Update

An enthusiastic and chatty crowd joined us bright and early on Thursday 4th April for our Annual Budget Breakfast.  This year we enjoyed the hospitality and artwork of the Ken Duncan Gallery in Erina Heights.

The Federal Budget seemed to address three main aims:

  • To deliver the long-awaited return to budget surplus
  • To provide fiscal stimulus to a struggling economy
  • To help get the Coalition re-elected

The Government made announcements around the following key areas:

  • Taxation
    • Increase to tax rebates for low & middle income earners
    • Reducing the 32.5% rate to 30% in 2024
    • Tax cuts approximately twice as big as those announced in 2018, although still only equating to $20 per week for average income earners
  • Superannuation
    • Change to the age that the ‘work test’ applies so that those aged 65 and 66 can contribute to superannuation regardless of their work status
  • Small Business
    • Extending the small business instant asset write off and increasing the threshold from $25,000 to $30,000; this also now applies to businesses with turnover up to $50m
  • Social Security & Aged Care
    • One-off Energy Assistance Payment
    • Increased Aged Care funding
    • Simplification of means testing forms
  • A record $100b will be spent on road & rail projects
  • $600m to facilitate the government’s response to the Financial Services Royal Commission

Once the group of 50 had finished enjoying the impressive spread as catered by the Sanctuary Café, we heard from James Tsinidis, Portfolio Manager from Munro Partners.  James looked at the current macroeconomic picture and discussed whether valuations were too high when comparing the equity risk premium to the government bond yield.  He also took us through a number of interesting case studies of companies with long growth runways including Apple, Netflix and Amazon.

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