Government fiscal support through March quarter 2022 targeted healthcare and support for individuals and businesses affected by floods in Queensland and New South Wales.
Governments further eased COVID-19 restrictions. International border restrictions eased for fully vaccinated visa holders, including tourists, from 21 February 2022. No major population centres were in lockdown. As COVID-19 cases rose Governments increased spending on healthcare. Testing, personal protective equipment, and COVID-19 vaccine programs were the focus, including the commencement of vaccines for children aged 5-11.
There was a shift in COVID-19 testing from polymerase chain reaction (PCR) tests to rapid antigen tests (RATs) during this quarter. The Commonwealth, state and territory governments invested over $1 billion to distribute RATs to concession card holders and the healthcare, education, and aged care sectors. The Western Australia government provided free RATs to all residents, while other state and territory governments implemented various programs to distribute free RATs in schools and early childhood education and care (ECEC) centres. This shift saw a decline in spending on PCR tests compared to the previous quarter.
Severe flooding events in Queensland and New South Wales increased Commonwealth assistance to households and businesses through the Australian Government Disaster Recovery Payment and other supports. The Australian Defence Force deployed over 7,000 personnel as part of Operation Flood Assist 2022.
The commencement of military and humanitarian assistance to Ukraine increased Commonwealth government expenses.
Taxation revenue fell in most jurisdictions, in part due to the ongoing economic impacts of COVID-19 and weather events. The main contributors to the fall were:
- income tax paid by superannuation funds, company income tax and goods and services tax for the Commonwealth, and
- stamp duties and land tax for states and territories.
The fall in taxation revenue in a March quarter following a December quarter rise is seasonal. This was partially offset by increased personal income tax paid to the Commonwealth and gambling taxes from the states and territories.