Election years always bring a bit of drama, and this year’s budget is no exception. The Government’s main focus is on tackling the cost of living crisis and housing affordability. While there aren’t many groundbreaking proposals for financial planning, there are a few key highlights worth noting.
Taxation
- Personal Income Tax Cuts: The lowest marginal tax rate will be reduced from 16% to 15% on July 1, 2026, and from 15% to 14% on July 1, 2027. This means every taxpayer will receive a tax cut from 2026/27.
- Medicare Levy Thresholds: The thresholds for low-income earners will be indexed, meaning more people will pay less or no Medicare levy.
Cost of Living and Healthcare
- Cheaper Medicines: From January 1, 2026, the maximum co-payment for general patients will be reduced from $31.60 to $25 per script. Concession cardholders will continue to pay $7.70.
- Energy Bill Rebates: Households and eligible small businesses will receive two energy bill rebates of $75 each from July 1, 2025.
- Medicare Rebates: From November 1, 2025, Medicare rebates for GP visits will increase, making healthcare more affordable.
Housing and Social Security
- Help to Buy Program: The Government’s shared equity program will be expanded, allowing more people to access it by increasing income and property price caps.
- Family Home Guarantee and Regional First Homebuyer Guarantee: These programs will continue, helping single parents and regional first homebuyers purchase homes with lower deposits.
- Three-Day Childcare Guarantee: From January 5, 2026, all families eligible for the Child Care Subsidy will receive up to three days of subsidised childcare per fortnight.
Other Highlights
- Student Debt Reform: A one-off 20% reduction on outstanding student loan balances will be applied on June 1, 2025. The repayment system will also be overhauled, allowing individuals to earn more before they start repaying their debt.
- Disaster Relief: Additional funding will be provided for disaster relief and rebuilding efforts, including support for those affected by Cyclone Alfred.
Overall, while the budget may not be the most exciting, it does offer some relief for everyday Australians, especially in terms of healthcare, housing, and cost of living. Cheers to cheaper medicines, energy rebates, and a brighter future! For any questions please reach out to the team at Boutique.