What does the 2025 budget mean for you?

26 March 2025

The treasurer delivered the 2025 budget last night, ahead of the federal election to come in May.

As expected, it’s not particularly exciting and seems more focused on Labor trying to get themselves re-elected.

If the government changes at the May election then you’re going to get a different budget with another government later in the year, but it’s still important to know if Labor stays on for the next 3-4 years.

There’s some cost of living relief, and a surprise small tax cut.

Here are the measures we think impact you.

Click into each for the details.

Minor income tax cuts

You’ll be getting a tax break of $268 from 2026 and $536 from 2027 which is minimal. It’s a surprise measure but less tax is less tax.

For the income tax bracket between $18,200 and $45,000, 16% is paid in income tax.
The government plans to cut this to 14% over the next two years.

If you earn over $45,000 a year, you’ll get a tax break of $268 from 1 July 2026, then a tax break of $536 from 1 July 2027.

If this does get implemented, it could mean contributing to your super pre-tax is more expensive than contributing after tax, if you earn less than $45,000 a year. That’s because pre-tax contributions are taxed at 15% when going into super, whereas you could be taxed at only 14% if you earn less than $45,000.

Cost of energy supplements

You’ll get more off your energy bill, which should be about $12.50 less a month.

Currently you get $300 a year off that goes towards your house of small business energy bills (speak to your energy provider if you aren’t sure!).

The proposal will increase this by another $150 from 1 July 2025, so a little bit of help towards the power bill.

Co-purchase your first home with the government

A limited scheme where the government puts down a part of your deposit, reducing what you need to put down.

The government first started this scheme in December 2024. The proposal is to expand to include established properties, where currently it is only available for purchase of new or off the plan properties.

You have to earn less than $100,000 pa (singles) or $160,000 pa (couples) and the max. property price depends on the area. The max values are going up to be properties valued up to $950k (Melbourne), $1.3m (Sydney) and $1m (Brisbane).

The number of places is very limited, at 10,000 a year, for four years, and probably is a first come first serve basis, and applications should start at the new financial year (1 July).

Reducing the cost of GP visits and PBS medicines

Visits to the GP should become cheaper or fully bulk billed (free), with the Medicare rebate for GP appointments going up. PBS medicines will also become cheaper.

Medicare rebates for visiting the GP is increasing. From 1 Nov 2025, the rebate will increase to $69.56 from $42.85 for metro areas, and a max of $86.91 if you’re regional.
Medicine scripts become cheaper, where you won’t have to pay more than $25 for a script covered under the PBS (Pharmaceutical Benefits Scheme), where currently its $31.60. Pensioners continue to pay just $7.70.

Student debt reductions

Students with uni debt paid via the government will have their debt reduced and have to start paying it back at a fairer, higher income.

20% of student debt through HECS/HELP debts will be slashed before they apply indexation at 1 July 2025. A uni student with the average debt of $27,600 will have about $5,520 shaved off their loan.

Repayments for students will only start if you earn $67,000 pa, up from $54,435 pa where it currently is.

Cheaper childcare

Childcare becomes a cheaper, saving around $10,000 per year for most families.

From 5 Jan 2026, all families (unless earning over $533,280 pa) will get 3 subsidised days of childcare per fortnight.

The subsidy will mean a family earning $120,000 pa in household income will be better off by $220 per week, or $10,630 pa.

Measures to support women

Increased earnings for aged care and childhood workers, and boosts to Medicare for various areas of women’s health and support for domestic violence victims.

Introduction of medicare rebates for assessment of menopause, and a 150% increase in Medicare rebates and bulk billing for IUD insertion and removal.

Cheaper contraceptives and treatment for UTIs and PBS listing for oral contraceptives and menopause therapies – means cheaper, capped pricing for those services.

Aged care and childhood educators can expect a boost to earnings (largely female workforce).

Increasing investment into domestic violence support services by $21.4m.

Incentives to get more people into housing construction

The government wants to get more apprentices into trade which they think will get more houses built.

From 1 July 2025 eligible apprentices in housing construction can receive up to $10,000 in financial incentives during their apprenticeships.

Employers can be eligible for a $5,000 hiring incentive for those in priority jobs (relevant to hosuing construction).

General Advice Warning: This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, Mandate Financial Planning and Futuro Financial Services Pty Ltd do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, Mandate and Futuro do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.

What does the 2025 budget mean for you?

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