Australia warned it will make "difficult decisions" on savings in its mid-year budget review as it seeks to plug gaps created by declining tax revenue and attempts to keep its promise to return a small budget surplus in 2013.
The effects of the global financial crisis have prompted a massive write-down of tax receipts in Australia, Treasurer Wayne Swan said on Sunday. In particular, revenue expected from capital gains tax would be A$7 billion ($6.8 billion) less than it forecast in May.
Overall, revenues were down by A$130 billion over the five-years to 2012-13 from pre-global financial crisis estimates, Swan said. "The substantial hit to revenues caused by global economic turbulence means we'll have to make some difficult decisions to find savings," Swan wrote.