Australian Federal Budget Faces $100 Billion Hit from Mining Export Decline

Weakened demand from China and global economic volatility are projected to drive a decade of deficits, with company tax revenues falling significantly.

• Treasury forecasts a $100 billion reduction in mining export revenue over the next four years, driven by China's economic slowdown and lower commodity prices.
• The decline in mining exports is expected to reduce company tax receipts by $8.5 billion, marking the first significant drop in these revenues since 2020.
• The mid-year economic update, set for release on Wednesday, is predicted to show a $33.5 billion deficit for this financial year, a $5.2 billion deterioration since May projections.
• Additional budget pressures include $1.8 billion in veterans' payments, disaster recovery costs, and increased spending on Medicare and childcare programs.
• Despite a strong jobs market helping to bolster income tax revenues, the federal government anticipates a decade of deficits, with limited flexibility to address nearly $500 billion in national debt.

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Australian Broadcasting Corporation The Guardian The Sydney Morning Herald