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Tax officials confirm budge revenue shortfall



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Senator J i m Short Shadow M inister for Finance and Shadow Minister Assisting the Leader on Commonwealth/State Relations

SMF42/92

TAX OFFICIALS CONFIRM BUDGET REVENUE SHORTFALL

It is clear from evidence presented in Senate Estimates hearings last week that the Government's revenue collections for 1991/92 will be less than forecast at the time of the 1991 Budget.

This will make the starting point deficit for the 1992/93 Budget greater than the Government has so far admitted.

Taxation officials last week revealed that to end February revenue collections were down $600 million on what had been forecast and that this shortfall may grow over the remainder of

the year.

For the existing revenue forecasts to be met, collections in the final four months of 1991/92 would have to be 7.1% higher than in the same four months of 1990/91.

The fact that the recession is much more protracted than even the Government had planned will cause several major sources of revenue to be below earlier forecasts. Despite some offsetting timing factors, such an increase over last year's final months' result will be extremely difficult to achieve.

The Tax Office told Senate Estimates that it and Treasury expect to have an agreed revised revenue forecast for 1991/92 available for the Treasurer by the end of April. In view of the

significance of these revisions for financial markets and for business and economic planning, it is essential that the

Government release them as a matter of urgency.

Melbourne 26 April 1992

COMMONWEALTH PARLIAMENTARY LIBRARY MICAH

FOR FURTHER INFORMATION (054) 395 305