Companies are all concerned with the issue of finding enough staff and they dread high interest rates, remembering the pain of the early 90’s according to Deloitte Tax Partner David Pring.

The government is seeking to address the talent shortage by increasing the workforce participation rate by extending child care rebates from 30% to 50% and longer term by extending spending on education. The announced increases in infrastructure will be welcomed by corporate Australia.

“By tightening spending and delivering a surplus of $21.7 billion, business will be hoping that the inflation genie will be kept in the bottle allowing downward pressure on interest rates,” said Mr Pring.

“Currently Mid Cap companies including many private companies have to contend with the same complex tax system that applies to the top end of town. Mid Caps will be keen to see the detail of the announced reform to the tax system; however they will have to wait until the end of 2009.”

“A genuine review of business taxation will be good news if it adequately deals with the many levels of state and federal taxes. Business needs to hold the government accountable to execute its strategy for business set out in the Budget,” added Mr Pring.