The Government will start rolling out payments of up to $900 to taxpayers as part of its $42 billion stimulus package, but the message from officials is; be patient.
Tax Commissioner Michael D’Ascenzo says the 7.4 million people who have lodged 2007-08 tax returns will start receiving their payments soon, with payments expected to be completed by 16 May.
“Due to the large number of payments, we ask that people don’t call us about the progress of individual payments while we are still distributing them,” he said.
Meanwhile, Federal Treasurer Wayne Swan has said that it is understandable many recipients of the payments will want to save the money, as they did for the last stimulus package.
“Some of it was saved, and that is a good thing too because what that does is bring forward the time at which many people will further consume,” he told ABC Radio.
Swan says that the bonus payments will help keep the economy strong until the Government’s infrastructure projects, including those designed for school maintenance, will begin.
“It takes a bit of time to organise that direct investment,” Swan said.
Meanwhile, inflation dropped by 0.1% in March due to falls in petrol prices, according to the TD Securities-Melbourne Institute monthly inflation gauge.
Gains in petrol prices over the past months were erased during March, which sent inflation falling for the fourth time in six months after a 0.7% increase in February.
“The RBA will take comfort from the dip in prices in March, and as a result it is likely to resume the interest rate cutting cycle when it meets tomorrow,” said Stephen Koukoulas, TD Securities global strategist.
Koukoulas says he expects the RBA to cut interest rates by 50 basis points to a record low of 2.75%.
The Australian sharemarket has opened 0.7% higher today after positive leads from Wall Street late last week. The benchmark S&P/ASX200 index was up 18.8 points or 0.5% to 3754.4 at 11.36 AEST.
The Australian dollar also remained steady at about US71 cents.
AMP shares gained 2.8% to $5.18, while NAB rose by 1.8% to $23.26. Westpac shares gained 1.3% to $20.66 as Woolworths dropped 0.2% to $24.84.
BrisConnections has entered a trading halt until tomorrow so it can finalise details about material information received about a potential approach towards unit holders.
“We are not able to make an announcement in respect of the details as they are not yet finalised,” the company said in a statement.
Bendigo & Adelaide Bank shares have dropped nearly 7% to $7.50 after it revised its forecasts for the 2009 financial year, predicting cash earnings of $205 million to $218 million.
“We have taken decisive action to protect this bank from the risks posed by the current banking environment,” managing director Rob Hunt said.
“And we have placed the bank in the best possible position to take advantage of any improvement in market conditions and confidence.”
Meanwhile, Telstra chief executive Sol Trujillo has told The Australian Financial Review that the company is looking forward to getting this week’s announcement of the winner of the Government’s broadband network bid out of the way.
Telstra was excluded from the process on 15 December last year after the Government said its bid was not in line with guidelines. The company is pursuing its own plans to upgrade its network to deliver high-speed broadband.
“We do look forward to the decision to be made by the Government because clarity is important to our shareholders, and it will be important to the implementation of our plans – be it plan A, or plan B, or plan C,” Trujillo said.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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