Australia Announces 2025 Budget Tax Reductions

The Australian government announced new tax cuts in its 2025 budget, reducing the tax rate from 16% to 15% by July 2026 and further to 14% by July 2027, providing AUD 6.7 billion in relief. Despite these cuts, the budget forecasts a deficit increase, with projections of AUD 42.1 billion for fiscal 2026. The budget also includes measures to extend energy rebates, boost investments in public healthcare, and freeze the draught beer excise for two years. These tax cuts aim to address voter dissatisfaction over high living costs, interest rates, and housing shortages ahead of potential elections. Critics claim the cuts are modest, with the average worker receiving about AUD 536 annually by 2027, and question their impact on long-term economic challenges. The Coalition has announced its opposition to these cuts, suggesting the possibility of proposing alternatives.