The 2025-26 Federal Budget has been released. We answer the question, “What is in it for me?” There is a $268 tax cut for the 2027 and 2028 Financial Years but we have to wait another year for this to start. We have $150 of electricity rebates and a 20% reduction of HELP Loans. Points to note include:
Individuals
- New tax rates from 1 July 2026 of:
- $0 to $18,200 – 0%
- $18,201 to $45,000 – 15% (Down 1%)(Then 14% on 1 July 2027)
- $45,001 to $135,000 – 30%
- $135,001 to $190,000 – 37%
- $190,000+ 47%
- Plus 2% base medicare levy on the above rates
- Electricity subsidy of $150 for each household being $75 paid for the September and December 2024 quarters.
- 20% reduction of Higher Education Loan Program (HELP) Loans if legislation gets passed.
- ATO to receive $1 Billion over 4 years to increase and expand tax compliance activities.
Business
- No announcement on Instant Asset Write Off of capital assets up to the limit of $20,000 for small businesses with a turnover of under $10 million. If there is no announcement during the election campaign, it could return to $1,000 from 1 July 2025.
Superannuation
- The Super Guarantee rate to increase to 12% on 1 July as previously legislated.
The Federal Government is estimating a $27.6 billion deficit for this 2025 Financial Year, a $42.1 billion deficit for the 2026 Financial Year and a $35 Billion deficit for the 2027 Financial Year and a $37 billion deficit for the 2028 Financial Year. The forecast is for budget deficits for the next 10 years! It appears most of the announcements are waiting for the election campaign with $500 million of unannounced measures in this budget.
These are only the main points. Please click here for the NTAA Budget Summary and click here for the CPA Australia Budget Summary.
