Fiscal update offers no Christmas gift for the economy

The only gift the Treasurer handed out in today’s Mid-Year Economic and Fiscal Outlook (MYEFO) was the one he gave himself, namely a stronger fiscal pot that will take a bit away from GDP growth next year. That said, he appears to be saving himself for personal income tax cuts, perhaps in May’s Budget. While there is some room for lower taxes, we think they would come at the expense of a budget surplus.