The 2025–26 Federal Budget, delivered by Treasurer Jim Chalmers on 25 March 2025, outlines critical measures addressing the ongoing economic pressures that individuals, families, and businesses across Australia are facing. In this review, we’ll break down the key points of the Budget and what they mean for your financial planning, business operations, and the broader economic landscape.
Key Highlights:
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Tax Cuts for Australians: Lower rates for income earners across various brackets.
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Energy Bill Relief: Continued support for households and businesses impacted by rising energy costs.
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Healthcare and Medicare: Investment in healthcare access, bulk billing expansion, and reduced prescription costs.
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Support for Renters and Homebuyers: Support for Renters and Homebuyers: Increased funding for housing projects and rental assistance to ease affordability pressures.
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Business Support: Measures aimed at improving business resilience, including digital security and cost relief for small businesses.
What’s in the 2025–26 Federal Budget for Individuals?
The 2025 Budget focuses on cost-of-living measures, tax relief, and healthcare access, providing support for families and individuals.
Income Tax Cuts
From 1 July 2026, income tax rates for Australians will be reduced, bringing additional relief to households. For example, individuals earning between $18,201 and $45,000 will see their tax rate drop from 16% to 15% in 2026, and further to 14% by 2027.
These changes will result in significant tax savings for many Australians:
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A taxpayer earning $79,000 will receive $2,190 in tax cuts by 2027–28 compared to previous settings.
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Over 2.7 million Australians will benefit from up to $1,340 in tax relief.
Energy Bill Relief
In response to the rising cost of living, households will receive continued support for their energy bills:
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A $150 electricity rebate for eligible households.
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Proposed reforms to energy pricing, helping Australians find better energy deals.
Healthcare & Medicare Access
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The PBS (Pharmaceutical Benefits Scheme) co-payment for prescription medications will drop to $25 starting 1 January 2026.
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There will be expanded bulk billing, with a goal to achieve 90% of GP visits bulk billed by 2030.
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$1.8 billion will be allocated to listing new PBS medications, including affordable treatments for menopause and endometriosis.
Support for Low-Income Earners and Students
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A one-off 20% reduction in student loan balances.
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Increased support for JobSeeker eligibility and payment rates.
What’s in the 2025–26 Federal Budget for Superannuation?
Superannuation remains a key area of focus in the 2025 Budget, with changes that will affect employers and employees alike.
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The Superannuation Guarantee will increase to 12% starting 1 July 2025.
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From 1 July 2026, employers will be required to pay super on payday, aligning superannuation contributions with the timing of wages.
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Efforts to improve compliance will continue, including measures to recover unpaid super from businesses that go insolvent.
What’s in the 2025–26 Federal Budget for Housing and Renters?
Housing affordability and support for renters and homebuyers are central to this year’s Budget, with measures designed to increase housing supply and provide assistance for those struggling with rising rent.
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The Help to Buy Scheme will expand, offering eligible homebuyers up to a 40% government equity contribution toward the purchase price of their home.
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A temporary two-year ban on foreign buyers of existing residential properties will take effect from April 2025.
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Increased funding for homelessness services and rent assistance, including a 45% increase in the maximum Commonwealth Rent Assistance.
How Will This Budget Impact Your Business?
The 2025–26 Budget also includes several measures aimed at supporting small and medium-sized businesses:
Energy & Cost Relief
Small businesses will continue to receive rebates on energy bills, with $150 allocated for eligible businesses, along with $56.7 million in energy efficiency grants.
Tax Relief & Regulatory Support
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The Budget extends tax cuts for 1.5 million sole traders, helping ease business operating costs.
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Regulatory compliance will be streamlined to level the playing field between big and small businesses, including support for fair trading practices.
Digital Security & Cyber Resilience
To address increasing threats, small businesses will receive additional support for improving digital security and cyber resilience, including grants and programs designed to uplift cybersecurity capabilities.
What Was Left Out of the Budget?
Despite its broad scope, the 2025–26 Budget does not address certain key concerns for businesses:
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No extension of the Instant Asset Write-Off program beyond 30 June 2025.
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No major new tax incentives or investment stimulus measures.
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Limited support for domestic manufacturing and innovation.
What Does This Mean for You?
Whether you’re an individual, a family, a business owner, or an employee, the 2025–26 Federal Budget brings changes that will affect your financial decisions moving forward.
If you’re unsure how the Budget will impact your personal or business financial planning, our team at Supervision Group can help you navigate these changes with confidence. We are here to assist you with understanding the finer details of the Budget and how it may affect your specific situation.
