Federal politics live: Treasurer urged to 'be bold' on productivity and ditch 'lazy' AI approach
Follow our live coverage below.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
News.com.au
15 minutes ago
- News.com.au
Criterion: Companies have cash to splash and it's raining down on shareholders
Several big-name companies are tipped to announce share buybacks or special dividends this reporting season Share buybacks improve earnings per share and usually result in long-term share support JB Hi-Fi is tipped to pay a special dividend when it reports on Monday As local profit reporting unfolds in earnest next week, investors can expect a slew of companies to announce share buybacks or special dividends to soak up excess capital. To some investors, returning capital is a sign that management has run out of growth ideas - a strategic capitulation. To most, remitting the spare cash makes better sense than either hoarding it or pursuing a hare-brained acquisition. 'If a company doesn't have attractive investment opportunities and the balance sheet is starting to look lazy, a special dividend can make a lot of sense,' says Lazard Asset Management's Aaron Binsted. 'It also demonstrates that a board takes shareholder funds seriously and the market is more likely to support that company in future endeavours.' Don't stash the cash Share buybacks involve a company buying back its own shares and cancelling them, thus reducing the capital base and improving earnings per share. Boards often deploy buybacks when they think the market undervalues the shares. (Mind you, almost every board thinks that). In February Telstra (ASX:TLS) announced a $750 million buyback which it completed in June. Others including ResMed (ASX:RMD) and Corporate Travel Management (ASX:CTD) have buybacks in place. According to Sandstone Insights, capital returns usually result in share prices being supported well beyond the announcement date. 'There is an enduring impact on outperformance,' says head of investment strategy John Lockton. Buyback 'likely suspects' The owner of Afterpay and the Square terminals, Block, Inc (ASX:XYZ) is surfing the resurgence of buy-now pay later and Square's strong growth in the US. Block has a $4 billion buyback program – extended from $1 billion last year - but yesterday's quarterly disclosure shows the actual purchases have been at a far more languid rate. This also highlights that while a company might have announced a program, it's under no obligation to buy. With tapering capex, logistics house Brambles (ASX:BXB) could extend its recently-completed $600 million buyback. The beneficiary of favourable regulatory capital changes, annuities specialist Challenger (ASX:CGF) could start one. With insurers creaming it in, QBE Insurance (ASX:QBE) is in pole position to undertake its first-ever buyback. Earlier this year Suncorp Group (ASX:SUN) distributed the $4.1 billion proceeds of its banking operation to the Australia and New Zealand Banking Group (ASX:ANZ). There's a chance of a second helping. Special dividend candidates Discretionary retailers are among the most likely companies to declare a special dividend. Binsted notes that Super Retail Group (ASX:SUL) paid a special dividend in the last two financial year results 'and we suspect there may be a possibility for a third'. The company may have its high-profile corporate governance issues, but it has a solid balance sheet with tapering capex requirements. On Monday, JB HiFi (ASX:JBH) should post a bumper result – and perhaps pay a special div as it did last year. Media companies usually sound like they're down to their last dollar. But that's not the case at Nine Entertainment Company (ASX:NEC), which is heaving with $1.4 billion of proceeds from the sale of its Domain stake to Costar. Nine has flagged a shareholder return of 47-49 cents per share, but that accounts for only half the windfall. TPG Telecom (ASX:TPG) similarly is flush with $5.3 billion from the sale of its fixed asset business to Vocus. Pundits suggest TPG will return about half to shareholders. Great (earnings) Expectations In order to sweeten shareholder returns, companies need further earnings in the first place. That's not been the case over the last three years, with profits going backwards, Sandstone's Lockton expects current year earnings expectations to settle at 6%. This will be spurred by the tech sector with forecast 25-30% growth. For the time being at least, the market is willing to overlook the T – tariff – issue. Lockton says even if tariffs are disruptive, "there's a wall of interest rate cuts both in the US and Australia to save the day.' Enjoy the cash splash while it lasts.
News.com.au
42 minutes ago
- News.com.au
‘Our tax system is broken': Economist defends proposal to raise GST to 15 per cent
The expert behind a proposal to hike the GST to 15 per cent has defended the controversial plan, saying Australia's tax system is 'broken' and needs 'bold change'. Ahead of Labor's Economic Reform Roundtable next week, UNSW economist Professor Richard Holden and WA Teal MP Kate Chaney have floated a radical plan to overhaul Australia's tax system — by raising the rate of the goods and services tax (GST) for the first time since it was introduced at the turn of the century. Under the proposal — which has already been ruled out by Prime Minister Anthony Albanese — the GST would by raised from 10 per cent to 15 per cent and broadened to include fresh food, health, childcare and education. To soften the blow, all taxpayers would receive a $3300 annual rebate, effectively removing the GST on the first $22,000 of someone's spending. 'I think there's no doubt that our tax system is broken and it's time for a bold change, but I want to give them something back in return,' Prof Holden told Nine's A Current Affair on Thursday night. According to Parliamentary Budget Office costings, the plan would raise an additional $95.2 billion for the government in its first year of operation, minus the $3300 rebate to every adult. Low and middle-income earners would be up to $371 better off, but the top 20 per cent of earners would be $2200 worse off. That would leave the government with an additional $24 billion a year. 'The Parliamentary Budget Office has gone through that and they say that on average the bottom 60 per cent of income earners would be better off,' Prof Holden said. He argued the overhaul would give the government room to cut Australia's income tax rates, which are among the highest in the world. 'What this would do after the compensation is leave you with enough money to cut the top marginal tax rate from 45 per cent to 40 per cent, [and] the second marginal tax rate from 37 per cent to 32.5 per cent,' he said. Ms Chaney denied the $3300 rebate was a 'bribe'. 'No, it's simply returning the GST on the first $22,000,' she told the program. 'What we're saying is we need more tax, paid by people who can afford to spend more. We have one of the lowest GST in OECD countries, about half the average, so by bringing the GST more in line with other countries we will actually be able to have personal income tax cuts and fix the budget.' She conceded a 5 per cent increase to the GST would 'probably' cause a 'one-off shift' in inflation. While Mr Albanese ruled out the proposal, Ms Chaney said she hoped it 'starts a conversation' ahead of the next election. 'It's politically really scary for people to talk about tax and I understand that, but if someone doesn't start it then we're never going to make any progress at all,' she said. Host Ally Langdon pressed Ms Chaney on why more could not be done to cut wasteful government spending instead of raising taxes. 'I would like it if the budget actually matched up each year,' Ms Chaney said. 'The reality is we've got an ageing population which means more health costs, more aged care costs, we have an NDIS, we want to support people with disabilities. People do expect a lot from government services.' Speaking to ABC Radio Melbourne on Thursday, Labor MP Andrew Leigh said while he liked Prof Holden, the government had no plans to touch the GST. 'The Prime Minister and the Treasurer have a longstanding view on the on the GST,' he said. 'The government isn't doing any modelling at the moment and doesn't have any plans to change the GST.' Dr Leigh argued there were 'more efficient taxes than the GST'. 'It hasn't been at the centre of the conversation around productivity,' he said. 'There was certainly more discussion around corporate tax, and that's been a matter that has occupied much more discussion from the Productivity Commission for example, which has thought more about investment allowances and company taxes than it has about expenditure taxes.' Asked whether he supported Ms Chaney's proposal, Mr Albanese on Thursday replied, 'Governments make government policy … the only tax policy that we're implementing, is the one that we took to the election.' That includes Labor's legislated $5-a-week tax cuts which would grow to $10-a-week in the 2027-28 financial year, and the push to double taxes on superannuation accounts over $3 million to 30 per cent. Mr Albanese noted there would be a 'range of ideas floated' ahead of the Economic Reform Roundtable set to take place from August 19 to 21, adding that people are 'entitled to put forward their views'. Despite this, the PM has rejected increases to consumption taxes, like GST, stating they were 'regressive in nature'. On Sunday, the Australian Council of Trade Unions (ACTU) unveiled its own proposal, calling for cuts to negative gearing and capital gains tax concessions for property investors to be limited to just one property, following a five-year grandfathering period. Asked about the ACTU plan on Wednesday, Treasurer Jim Chalmers noted the government's longstanding promise to not adjust negative gearing and capital gains tax concessions, but said he didn't want to 'get in the habit of knocking off ideas before we get in the room'. 'The guidelines I've put around people's contribution is to make sure that there's specific ideas, that they're affordable, that they're in the national interest and people try and engage with each other and not just the government on them,' he said. 'Some people have embraced that challenge, others haven't. I've tried not to kind of engage in a daily running commentary on every idea that's pitched up.' Meanwhile, the Australian Council of Social Services (ACOSS), in its submission to the roundtable, has called for reform to the tax system to raise more revenue, reduce inequality and drive action to address climate change. 'For too long now, people with plenty have been showered with tax breaks that pull investment away from productive purposes and rob essential public services of the revenue they need,' Dr Goldie said. The council is advocating for changes to employment opportunities and streamlining income support. 'The extra revenue we need to fund care and community services, schools, and an income support system that protects people from poverty must come from those with the most capacity to pay — not those doing it toughest,' ACOSS chief executive Cassandra Goldie said. 'We must better prepare and train people for jobs and finally lift income support to levels that don't trap people in poverty and destitution.' Opposition leader Sussan Ley on Thursday accused the government of using the roundtable to push tax hikes under the guise of productivity reform.
SBS Australia
an hour ago
- SBS Australia
Australia stands strong on global plastic pollution treaty
Australia stands strong on global plastic pollution treaty Published 8 August 2025, 8:34 am Australia says it will hold firm on its support for a global treaty to curb plastic pollution, in the face of pressure from the United States to reject the terms of the pact. A UN meeting this week has been aimed at breaking a deadlock in efforts to broker the agreement.
