Victoria’s economy is gradually shaking off the impact of COVID-19, with increased employment and population growth, according to the state government’s mid-year financial report.
The report said gross state product was “well above pre-pandemic levels” and that its growth had “outpaced the national average”.
It also said total revenue for the six months to December 31 last year was $39.9 billion while total expenses for the same period were $44 billion.
“Taxation revenue was $14.4 billion, or 46% of the revised full-year budget estimate,” the report says.
“Taxation revenue increased by $1.4 billion compared with the same period last year. This was primarily due to an increase in payroll tax, due to the strong labour market, and the introduction of the Mental Health and Wellbeing Levy, which came into effect on 1 January 2022.”
Led by increased consumer spending, state final demand increased by 4.1%. Consumer spending in Victoria grew 8.1% over the year.
There was also a shift in the net result from transactions deficit over the final six months of the year — $4.2 billion. This was an improvement of $5.8 billion from the same period in the previous year.
This improved figure was also driven by the increase in payroll tax and the Mental Health and Wellbeing Levy, as well as increased revenue from sales of goods and services.
“[This is] partly due to the upfront recognition of licence revenue from the VicRoads Modernisation for its right to deliver specific administrative and cash collection services,” the report said.
Some of these movements contributed to an overall deficit of $694 million in the six months to December 31.
“This is an $8.3 billion improvement compared with the same period last year,” according to the report.
The report also spruiks the increase in employment.
“Over the year to December 2022, Victoria’s employment increased by 2.2%,” the report says. “This was driven entirely by an increase in full-time employment, which increased by 4.5%, while part-time employment decreased by 2.5%.
“Meanwhile, Victoria’s unemployment rate decreased by 0.8 percentage points to a historically very low 3.5%.”
READ MORE:
Any feedback or news tips? Here’s where to contact the relevant team.