The 2025 Federal Budget, handed down last night by Treasurer Jim Chalmers, focuses on cost-of-living relief, housing affordability, healthcare investment, education reform, and tax cuts, all while aiming to maintain a budget surplus and support Australia’s long-term economic resilience.
• Energy Bill Rebates: $150 for all households and $150 for eligible small businesses• Medicare Levy Threshold Increase: Singles earning <$27,222, families earning <$45,907, single pensioners earning <$43,020, and pensioners earning <$59,886 will be exempt from paying the medicare levy
• Cheaper Medicines: PBS co-payments reduced to $25 from $31.60, effective 1 January 2026
• Rent Assistance: A 10% increase to the maximum rate for eligible recipients
• Income Tax Reductions: The tax rate for incomes between $18,201 and $45,000 will decrease from 16% to 15% on 1 July 2026, and further to 14% on 1 July 2027
• Non Resident & Foreign Investor Buyer Restrictions: A 24 month ban on property purchases by foreign individuals & companies including temporary residents starting mid 2025, aimed at increasing supply for local buyers.
NB. In FY23, there were 5,360 residential real estate purchases for temporary residents worth $4.9B
• Increased Foreign Buyer Fees: Higher application fees and vacancy taxes for foreign owned properties
• Housing Supply Boost: $11.3 billion investment to support the construction of 1.2 million new homes over five years
• Help to Buy Scheme: $800 million to increase the scheme’s caps on property values and buyer incomes and include the government paying for up to 40% of a new build and up to 30% of established properties and allow for purchases with deposits as small as 2%
• Prefab & Modular Construction: $54 million to support the expansion of prefab & modular construction to assist with ongoing housing supply issues
• Social and Affordable Housing: Additional funding allocated to the National Housing Accord and Housing Australia Future Fund with a target to build 55,000 properties over the next 5 years
• Transport Projects: An additional $17.1 billion over 10 years for road and rail projects to enhance connectivity & support urban development
• Western Sydney Development: More than $2.3 billion allocated for infrastructure and transport projects in Western Sydney, including $1 billion to preserve the corridor for a future rail link to the Western Sydney Airport
• National Broadband Network (NBN): Up to $3 billion in equity to complete the NBN rollout, aiming to improve digital connectivity nationwide.
• Early Childhood: $5 billion investment including wage increases for educators and infrastructure upgrades
• School Funding: $407.5 million over four years for states aligning with the Better and Fairer Schools Agreement
• Higher Education: 20% reduction in HECS/HELP debt for 3 million Australians and increased income threshold for repayments from $54,435 to $67,000
• Free TAFE: 100,000 free TAFE places every year from 1 January 2027
• Medicare: $7.9 billion to expand bulk billing and improve access to GPs
• Hospitals: $1.8 billion in 2025 to 2026 to reduce wait times and ease pressure on emergency departments
• Women’s Health: $792.9 million over five years for reproductive health and menopause care
• Aged Care: $17.7 billion for pay rises, plus an additional $291.6 million to continue to deliver historic aged care reforms
• $20,000 Instant Asset Write Off: Extended for another year for businesses with turnover of less than $10 million
• Energy Efficiency Grants: Continued support to lower business energy costs
• $26.9 Billion Deficit: Forecast for this financial year after delivering back to back budget surpluses
• Inflation: Expected to return to the RBA’s target range by late 2025
• Economic Growth: Slower in the short term, with signs of recovery by 2026
These measures reflect the government’s effort to ease pressure on families and businesses while improving access to healthcare, housing, education, and enhancing infrastructure.
If you’re considering your next property move, investment, or adjusting your financial strategy, we’re here to help.
Get in touch with us to discuss how this budget may affect your personal or financial situation.
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