Budget 2025-26: Show Me The Money

The Government’s big moment in the 2025-26 Federal Budget was the personal income tax cuts. Income tax cuts are a dazzling headline but in reality they deliver a tax saving of up to $268 in the 2026-27 year, with a tax saving of up to $536 from the 2027-28 year.

At the same time, the Australian Taxation Office has been allocated almost $1bn in funding to extend and enhance its compliance programs.

Two previously announced measures of note that have not passed Parliament but remain in the Budget are:

·      Tax on super accounts above $3m (a 30% tax on future earnings for superannuation balances above $3 million); and

·      The $20,000 instant asset write-off for small business for 2024-25.

Key initiatives include:

Energy

·      $180bn to deliver a $150 energy bill rebate extension until the end of 2025.

Healthcare

·      $8.5bn on Medicare for increases to Medicare payments, 50 new urgent care clinics, and a bulk billed GP service.

·      $1.8bn over 5 years for cheaper medicines on the Pharmaceutical Benefits Scheme.

·      $240m for women’s health - reproductive health and menopause

Education

·      $500m to provide a 20% cut to HECS-HELP debt for students, and a realignment of the repayment schedule to reduce the amount required to be paid (from 1 July 2025).

Housing

·      $800m to expand the ‘Help to Buy’ scheme reducing the size of the deposit required to buy a home by co-buying with the Government.

Families

·      Three days of subsidised childcare for families with young children (income tested) from 1 January 2026 replacing the Child Care Subsidy activity test.

Lifestyle

·      From August, the excise on beer will be frozen for 2 years.

If you have any questions on the budget and how it may affect you, please contact the team at Maher Group today on 8522 4500.