Business

Gillard's budget position may be vindicated yet

THE surging price of iron ore could see the Gillard Government's budget position strengthen, despite reportedly no revenue from the mining tax for the second quarter since its introduction last year.

While The Australian reported on Monday the mining tax had returned no revenue to government coffers for the second consecutive quarter, the price of iron ore has surged from last year's lows to about $158 a tonne.

That increase could see the mining tax make up for at least some of the existing shortfall in tax revenue - and while it may not be enough to return to surplus, it could put a dent in the 2011-12 deficit of $43 billion.

Some economic forecasts have shown a return to stronger growth from Australia's biggest iron ore buyer, with Fitch Ratings' outlook predicting 3% to 4% growth in Chinese iron ore demand.

The Fitch outlook also forecast continued growth in Chinese steel demand, but only of less than 5% for the next few years.

HSBC chief economist Paul Bloxham told APN Newsdesk he expected China's demand for the commodity to be much healthier in 2013 than last year.

He said the current spike in prices was due to three main factors; the rising Chinese demand, a fall in Indian exports and a recent cyclone hindering exports from Western Australia.

And while the surging iron ore price could spell a better position for the government's budget, Deloitte Access Economics predicted in September it would only be temporary.

In its quarterly business outlook, Deloitte economists predicted a "pothole in growth in 2014-15", with the huge mining construction sector to slow before the expanding LNG exports hit their straps.

Topics:  budget, economy, hsbc, iron ore, julia gillard, mining, tax



How a man makes it as a chef in Rocky, using only one arm

R-L: are Jez, Rocky Resort Motor Inn Manager Don McLeod and CQUni Chef Teacher Tim Wade.

'I've since learned that I should never judge a book by its cover'

Speculation of aliens, superman and plane crashes

No Caption

Was it a bird, was it a plane, was it superman?

Local Partners

PREVIEW: Luke Cage origin story is a strong addition to MCU

Mike Colter in a scene from the TV series Marvel's Luke Cage.

MIKE Colter stars as latest Marvel superhero to get his own series.

Kate goes down fighting in heated Survivor elimination

Australian Survivor contestant Kate Campbell.

YOGA teacher's 'good guys' alliance fails to get off the ground.

Emily Blunt's (almost) singing career

Emily Blunt nearly became the British Britney Spears.

Angelina is blocking calls from Brad Pritt

Angelina Jolie has reportedly blocked Brad Pitt's number.

Apocalyptica 'seek and destroy' sceptics with 'master' set

Apocalyptica play Max Watts in Brisbane on their Shadowmaker Tour.

Review of final show of Apocalyptica's tour

Rebecca Hall doesn't own a TV

Newspapers, yes. Television, not so much

$40million hotel, shops development project for Mackay

Mt Pleasant hotel and retirement accommodation, proposed at 194-202 Malcomson St.

$40m development to take Mackay to 'the next level'

Projects hoped to revive Rockhampton real estate

There have been just over 800 house sales in Rockhampton this year

Property 200m from ocean selling for just over $100K

BEACHCOMBER PARK: Work has started on a new $19.2 million development at Toogoom.

The estate's developer is offering huge discounts for early buyers.

UPDATE: Former rodeo champ's sale rained out, now back on

Larkhill local Ken Consiglio is having an auction of most of the things on his property.

'People kept showing up and we had to turn them away'

First stages of $25 million housing development underway

New development on Madsen Rd - The Springs.

The blocks of land are much bigger than usual

14% of renovators doing own electrical work?

Landscaping (46%), demolition (43%) and interior design (77%) are also often tackled head on by plucky homeowners.

And 12% said they did their own plumbing work