Exclusive: Treasurer wins support to use debt to build Australia out of recession | swrighteconomy
Australians have given Treasurer Josh Frydenberg the green light to borrow big in next month's federal budget to pull the country out of recession and help the nation's unemployed while businesses want a higher GST to pay down government debt.
The Reserve Bank, in the minutes of its September meeting released on Tuesday, argued all levels of government could increase their borrowing levels to boost the economy."In an environment of record low borrowing rates and significant spare capacity in the economy, this meant fiscal policy was well placed to continue to support the recovery," the minutes said.
By August, the number supporting long term borrowing had climbed to 48.3 per cent while those opposed had dropped to a survey-low of 23 per cent. About 29 per cent were still unsure. Almost two-thirds of the survey, including a majority of Coalition voters, supported an increase in the JobSeeker payment of at least $75 a week. The coronavirus supplement to those on welfare such as JobSeeker is due to start being reduced later this month.
A report last month by the independent Parliamentary Budget Office found the GST, described as a "growth" tax when it was introduced in 2000,Support for targeting corporate tax avoidance or the nation's highest paid individuals dropped by 10 percentage points between February and August. But support for GST changes grew about a third to almost 20 per cent.
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