SYDNEY: Australian tax revenues over the eight months to February were down A$4.5 billion ($4.7 billion) on forecasts, Treasurer Wayne Swan said on Sunday, blaming natural disasters, the strong Australian dollar and consumer caution.
Swan said in a regular economic note that the shortfall would make it harder to get the budget back into surplus. His comments come in the run-up to the annual budget for the fiscal year from July 2011 to June 2012, which is expected to be a tight one.
"Today I can provide new figures showing Commonwealth tax collections over the first eight months of this financial year are down around A$4.5 billion against where we had forecast to be at this time of year," Swan wrote.
He did not give a figure for the amount forecast.
"Personal income tax collections are about A$1 billion lower while business tax collections are down around A$3 billion."
Swan said his figures were based on forecasts in a mid-year budget update issued late last year. Part of the shortfall was attributable to reduced capital gains as a result of the Australian share market's failure to recover to levels seen before the 2008 global economic crisis, he said.
The government would nevertheless seek to get the budget back into surplus, Swan said, warning of difficult decisions ahead.
"Losing big slabs of revenue like this of course makes it even tougher to get back to surplus as planned, but we're determined to make the difficult decisions to meet that commitment," he said.
Around the beginning of this year, a string of natural disasters hit Australia, including widespread flooding across eastern states including the third city Brisbane, and a cyclone in the northeast.
Despite this, the Australian dollar has continued to strengthen and last week rose above the $1.05 mark, its highest level in 29 years.
The Labour government kept Australia out of recession during the global crisis by spending a huge budget surplus built up by its conservative predecessors. Australia's strong recovery has been led by surging demand for its key commodities exports, particularly from mining, and especially iron ore.
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