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Asia Today: Morrison vows ‘titanic effort’ to lift economy – 660 News

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CANBERRA, Australia — Prime Minister Scott Morrison says the Australian budget, to be delivered Oct. 6, will be a “titanic effort” to return the country to economic growth amid the coronavirus pandemic.

Morrison told reporters Sunday that the budget will the “most unprecedented investment in Australia’s future.”

Australia’s gross domestic product shrank 7% in the quarter form April to June, the largest contraction since record-keeping began in 1959. That followed a 0.3% decline in the first quarter, meaning Australia was technically in recession for the first time in 30 years.

Australia was the only major economy not to go into recession during the 2008 global financial crisis, its strength supported by strong demand, especially from China, for its natural resources — coal, natural gas and iron ore.

Even before the coronavirus, the economy was affected by massive bushfires in January that hit small businesses, which depend on tourism. Business shutdowns forced by the pandemic cost almost 1 million jobs and resulted in a major reduction in household spending despite Morrison’s government providing almost $200 billion Australian dollars ($140.5 billion) in economic stimulus.

Morrison said the upcoming budget “will be a titanic effort that we’re involved in to ensure that this country can get back on the growth path that we want to be on. That means we’re going to have to do some very heavy lifting in this budget and that comes at a significant cost.”

Treasurer Josh Frydenbeg, who will deliver the budget speech, on Thursday provided a downbeat economic outlook. Frydenberg said the economy likely will be 6% smaller by mid-2021 than forecast at the end of last year.

He said the government’s focus will be on economic recovery rather than budget repair until unemployment is “comfortably” less than 6%.

“Australia’s future population will be smaller and older than we previously assumed because of the sharp drop we are seeing in net overseas migration,” Frydenberg said. “While migration will eventually return to the levels we are accustomed to, lost migrants will not be replaced.”

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Follow AP’s pandemic coverage at http://apnews.com/VirusOutbreak and https://apnews.com/UnderstandingtheOutbreak

The Associated Press

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Hilton CEO: 'We need additional stimulus to the economy, period' – Yahoo Canada Finance

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CBC

Vancouver crime rate steady in 2020 compared to 2019, according to new stats from VPD

Vancouver’s crime levels for 2020 are similar to 2019, according to a new report from the Vancouver Police Department. Comparing the same time period, from January to September, there were 4,396 reported crimes in 2020 versus 4,397 incidents in 2019.The VPD says certain types of crime have increased — for example, serious assaults have increased by 14 per cent over the previous year — and others, like robberies, have decreased by six per cent. Crime rose in these categories compared to 2019 according to the VPD report:   * The number of homicides are higher this year: 14 in 2020 versus nine in 2019. * Serious assaults, which includes assault with a weapon, assault causing bodily harm and aggravated assault, are up by 14 per cent. * Intimate partner violence is 4.6 per cent higher than 2019. * Anti-Asian hate crime incidents increased by 138 per cent. * Break-and-enters to businesses increased by 18 per cent. * Arson incidents increased by 39 per cent. * Assaults against police officers have gone up 47 per cent.Crime fell in these categories compared to 2019:   * Robberies are down six per cent. * Property crime decreased by 20 per cent. * Theft from vehicles has decreased by 37 per cent. * Theft, like shoplifting, decreased by 26.6 per cent. * Sexual offences reported to police have decreased by 5 per cent.Const. Tania Visintin with the Vancouver Police says some of the numbers can be explained by the pandemic shutdown including a decrease in shoplifting and the increase in business break-and-enters because many businesses were closed earlier this year. There was also data collected in specific neighbourhoods. The report found that in the three-block radius around Strathcona Park, calls to police for street disorder increased by 51 per cent. They increased by nine per cent in Chinatown and Yaletown.”There have been a group of very vocal Yaletown residents that have spoken to the city, especially about what’s been going on … so we hear these concerns. And as the police, we can definitely try to target these suspects,” Visintin said. She noted that police were able to arrest four people in connection with a series of mail thefts, break-and-enters and frauds in the downtown core this week.”We have these stats now and now we can continue with more projects and more reallocating of resources,” she said.

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Agriculture, manufacturing help soften blow to P.E.I.'s economy – CBC.ca

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The impact of COVID-19 on P.E.I.’s economy isn’t projected to be as bad as first expected, says the province’s director of economics and statistics.

Nigel Burns told a standing committee the GDP is expected to take a 3.9-per-cent hit this year, which is better than the five-per-cent-drop in previous projections.

He said up until July, the tourism industry was hit the hardest. But other industries, such as manufacturing and agriculture, haven’t been hit as hard, resulting in less of an impact on the Island’s overall economy.

Statistics Canada’s farm cash receipts report showed sales of $203.6 million for the first half of the year, the best first half since 2009. Crop sales drove most of the increase, with livestock sales up only marginally over 2019.

Burns said it’s “still not a great situation” for the overall economy.

Nigel Burns, P.E.I.’s director of economics and statistics, said while the economy is better than expected, it’s ‘still not a great situation.’ (Travis Kingdon/CBC)

“Everyone is predicting a contraction, but things are starting to tighten up and be less of an impact for the year,” he said.

“Since we don’t have such a big contraction, we won’t have as strong a rebound in the following year, but that’s OK, we have less destruction in the first place to heal in the second year.” 

Burns told the committee much still depends on how the COVID-19 situation progresses on P.E.I. and with its trading partners around the world.

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ADRIAN WHITE: Underground economy is thriving – Cape Breton Post

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There is no doubt that COVID-19 has changed the way businesses function in Cape Breton. The pandemic has forced many entrepreneurs to reshape operating strategies for financial survival.  

Think of the new safety protocols for restaurants to protect staff and customers from virus transmission. Think sporting events playing out before near-empty stadiums and instead focused heavily on revenues generated from media broadcast of the event.  

There are just too many changes to business practices to list here in this column including the growth of digitization in our economy but I wanted to single out a few examples to illustrate some telling impacts. 

One major impact comes from folks not feeling safe to travel outside the province or eat out in restaurants due to the pandemic. Instead, they are using some of those cash savings to fund home improvement projects right here in the Cape Breton economy. That is a good thing for our community and our workers and it supports the “Shop Local-Buy Local” mantra being promoted by the local business community. 

Demand in the home improvement sector has soared and is so strong that it has led to a shortage of building materials, a rapid rise in material costs and a shortage of skilled labour to take on those home improvement projects.  

Many new contractors have entered the home improvement business in 2020 and many anxious homeowners are in hot pursuit of their services. Sometimes these contractors show up when expected to do a job and sometimes not. This has been a long-standing problem with small contractors in Cape Breton.  

Some contractors present an official written quote including HST for the project leaving a paper trail to follow while other contractors are quite prepared to take cash from the customer thereby avoiding HST. Cash leaves little trail for CRA to follow when it comes to reporting taxable income. 

This practice leads me to shed some light on the underground economy and its impact on our well-being as a province. Statistics Canada defines the underground economy as “consisting of market-based activities, whether legal or illegal, that escape measurement because of their hidden, illegal or informal nature.”  

I use the construction industry as an easy-to-understand example but you can imagine other opportunities for tax avoidance including buying illegal cigarettes, street sold cannabis, cash tips, paying cash for services, Airbnb cash rentals, or offshore bank accounts not being reported to CRA. 

In Nova Scotia, according to Statistics Canada, the underground economy was estimated to be $1.28 billion in 2018. That is near 3 per cent of provincial GDP. This is revenue that escapes government taxation. Nova Scotia’s underground economy as a share of GDP is higher than the national average which is troubling. Taxes on $1.28 billion would go a long way to offset the forecasted 2020 Nova Scotia budget deficit of $853 million due to the pandemic. 

Some of the underground economy is driven by the fact Nova Scotia has the second-highest personal income tax rates in the country. It remains one of three remaining provinces in the country that still practices “bracket creep” on your personal income tax deduction by not adjusting it to CPI on your annual income tax return.  

The higher the taxes the more incentive it provides for individuals and companies to embrace tax avoidance. Alberta has one of the lowest personal income tax rates in Canada and no provincial sales tax. It abandoned “bracket creep” on its residents decades ago. It also has one of the lowest underground economy as a share of GDP rates in the country running at 1.8 percent of provincial GDP.  

British Columbia has the highest ratio at 3.7 percent of GDP. In Canada, the underground economy was valued at a whopping $61 billion in 2018 amounting to 2.7 per cent of national GDP.  

I can only imagine with the increased demand for home improvement projects in Canada due to the pandemic that underground economic activity will likely increase 50 per cent rising close to $90 billion for 2020. 

In Nova Scotia, residential construction accounts for over 25 percent of the estimated underground economy GDP.  The next six largest contributors to the underground economy amount to about 50 per cent of Nova Scotia’s underground economy. They are retail trade, accommodation/food services, finance/insurance/real estate, manufacturing, professional/technical services and health care/social assistance.   

If we want to grow the Nova Scotia economy and thereby increase tax revenues to pay for the services we all expect, we are going to have to rethink the tax burden on individuals and businesses to bring balance and fairness to the tax environment. It is one of the reasons we struggle to recruit doctors to Cape Breton. Above-average taxes in Nova Scotia hinder economic expansion. High taxes will continue to drive the underground economy and tax avoidance until we address them. 

Adrian White is CEO of NNF Inc, Business Consultants. He resides Sydney & Baddeck and can be contacted at awhite889@gmail.com.

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