Latest news with #BudgetDeficit
Daily Mail
3 days ago
- Business
- Daily Mail
Anthony Albanese dodges huge tax question every Aussie wants answered after Treasury accidentally released secret advice telling the PM to raise it
Anthony Albanese has refused to say whether or not he will raise taxes after Treasury advised a hike to fix the federal Budget deficit. Insiders host David Speers grilled the prime minister on the topic on Sunday following revelations Treasury had made the suggestion. In an extraordinary blunder, bureaucrats mistakenly released parts of a secret briefing document given to the incoming Labor government in response to an ABC Freedom of Information request. In the briefing notes, officials told Treasurer Jim Chalmers that 'tax should be raised as part of broader tax reform' to make the federal Budget 'sustainable' as Treasury forecasts years of Budget deficits. The officials suggested the government 'build on' its superannuation tax and raise 'indirect taxes', such as those on alcohol and tobacco, with personal income taxes now making up more than half of Commonwealth revenue. 'Is Treasury right? Do we need to increase the tax take?' Speers asked Albanese. 'Well, what we need to do is to make sure that our tax system is fair, and we will always do that,' the prime minister replied. Speers repeated his question, before Albanese avoided answering for a second time. 'Well, what we need to do is get fiscal policy right,' he said. Speers asked what that meant for voters, and if it directly translated to increasing the total amount of taxation. 'What it means is what we've done, which is we produced two budget surpluses and we've reduced the budget deficit going forward, compared with what it was anticipated to be before we were elected,' Albanese said. The prime minister reasoned Treasury advice was not government policy, and said he encouraged departments to put forward their advice. He said his Labor government would keep a close eye on the budget and 'be responsible'. 'But surely you have an idea, as to when you look at the budget, whether you agree that tax needs to go up and spending needs to go down to fix it?' Speers asked a third time 'What I agree to is what we do in the Expenditure Review Committee, that's already begun meeting... [and] examine each policy to make sure that there's value for money,' Albanese said. He also said other policies like his superannuation tax changes would 'come in time'. The Treasury advice was accidentally provided to the ABC along with other documents in response to a Freedom of Information request. While the document featured the typical redactions, a Treasury official forgot to black out sensitive headings and subheadings, disclosing secret and politically damaging information. The advice forecast years of budget deficits. Officials suggested the government 'build on' its superannuation tax and raise 'indirect taxes', such as those on alcohol and tobacco, with personal income taxes now making up more than half of Commonwealth revenue. The document also shows officials bluntly told Labor that the party's pledge to build 1.2million homes over five years in response to the housing crisis 'will not be met'. Labor is already seeking to increase taxes on super balances above $3million. Chalmers at the time declined to rule out any new tax hikes ahead of the August economic roundtable.
Yahoo
31-05-2025
- Business
- Yahoo
Soaring U.S. debt doesn't just put America at risk. It could trigger contagion across global markets, IIF warns
Treasury yields spiked recently amid mounting fears that investor demand for U.S. debt is waning just as supply is taking off, with a budget bill in Congress expected to add trillions to the deficit. But the effects of rising debt won't be limited to the American economy, according to the Institute of International Finance. It's not just Americans and the federal government poised to feel the effects of U.S. debt, which has exploded in recent years and could get even worse soon. Borrowing costs in certain countries often move in tandem, meaning volatility in Treasury bonds will create ripples in other debt, according to a recent report from the Institute of International Finance. 'The implications of rising U.S. debt levels are not limited to the domestic economy; they are also likely to trigger significant contagion and spillover effects across global bond markets,' IIF economists wrote on May 22. 'A potential increase in volatility in U.S. Treasury markets—driven by growing market attention to supply-demand dynamics and the composition of borrowing needed to finance anticipated large funding requirements—is likely to transmit to other jurisdictions, though the magnitude of the impact will vary.' U.S. debt has been top of mind lately as a Republican budget bill moving through Congress is expected to add trillions to the budget deficit in the coming years. That's jolted Treasury yields, and weak demand at a 20-year bond auction earlier this month exacerbated fears that investors won't have an appetite big enough for all the red ink coming soon. In fact, Deutsche Bank warned there's a buyer's strike among foreign investors, who are no longer willing to finance massive U.S. fiscal and trade deficits. IIF pointed out that there's a long-standing pattern of sovereign yields moving together, especially in the U.S., U.K., Germany and France, 'reflecting the deep interconnections among these economies through trade and capital markets.' Yield sensitivity is more limited in Japan and other some major emerging markets, according to IIF, but their interconnections were on display recently and showed that volatility can flow in both directions. A weak auction of 40-year Japanese government bonds on Wednesday sent JGB yields higher—and U.S. Treasury rates as well. Days earlier, George Saravelos, head of FX research at Deutsche Bank, predicted higher yields for Japanese assets would make them a more attractive alternative for local investors, encouraging further divestment from the U.S. To be sure, the vastness of the Treasury market and its deep liquidity mean that buyers and sellers will still be drawn to the U.S., but that immense size also crowds out others. IIF said in its report that there are signs of more sensitivity to rising U.S. debt levels among emerging markets, due in part to a shrinking pool of international capital available to sovereign EM borrowers. 'With the U.S. and Euro Area accounting for over 60% of global cross-border debt portfolios, emerging markets and developing countries represent less than 7%—with many individual countries accounting for only a fraction of a percent,' the report said. This story was originally featured on
Bloomberg
19-05-2025
- Business
- Bloomberg
‘Sell America' Is Back as Moody's Pushes 30-Year Yield to 5%
Investors faced yet another bumpy start to the trading week with US assets coming under fresh pressure, although it's mounting concern over American debt rather than tariffs generating the volatility this time. Longer-dated Treasury yields rose to touch the psychological 5% level and US equity futures slid with the dollar in Asia trading after Moody's Ratings announced Friday evening it was stripping the American government of its top credit rating, dropping the country to Aa1 from Aaa. The company, which trailed rivals, blamed successive presidents and congressional lawmakers for a ballooning budget deficit it said showed little sign of narrowing.
Yahoo
19-05-2025
- Business
- Yahoo
Gold Gets Bounce From Moody's US Downgrade After Big Weekly Drop
(Bloomberg) -- Gold bounced back after its biggest weekly decline in six months, with appetite for haven assets boosted by mounting concerns about the US economic outlook and budget deficit. How a Highway Became San Francisco's Newest Park America, 'Nation of Porches' Power-Hungry Data Centers Are Warming Homes in the Nordics Maryland's Credit Rating Gets Downgraded as Governor Blames Trump NJ Transit Train Engineers Strike, Disrupting Travel to NYC Bullion rose as much as 1.3% to around $3,245 an ounce in early Asian trading. That was after Moody's Ratings announced late Friday it was downgrading the US government's top credit rating of Aaa to Aa1. The agency blamed successive administrations' inability to cut the budget deficit. 'While we recognize the US' significant economic and financial strengths, we believe these no longer fully counterbalance the decline in fiscal metrics,' Moody's said in a statement. The precious metal has been volatile in recent months. It suffered the biggest weekly loss since November last week on easing geopolitical tensions, after a blistering rally that saw it climb above $3,500 an ounce for the first time last month. Gold is still up by more than one fifth this year, driven by geopolitical and economic uncertainties, trade tensions and inflows to exchange-traded funds. Gold traded 1.2% higher at $3,231.13 an ounce as of 7:43 a.m. in Singapore. The Bloomberg Dollar Spot Index dipped 0.2%. Silver, palladium and platinum all rose. Why Apple Still Hasn't Cracked AI Microsoft's CEO on How AI Will Remake Every Company, Including His Cartoon Network's Last Gasp DeepSeek's 'Tech Madman' Founder Is Threatening US Dominance in AI Race As Nuclear Power Makes a Comeback, South Korea Emerges a Winner ©2025 Bloomberg L.P.
