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Australian Budget Unveiled with Tax Cuts and Cost-of-Living Relief Ahead of Election

The Albanese government’s 2025 budget forecasts rising deficits and debt while pledging modest tax cuts, healthcare funding, and economic resilience measures.

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A commuter walks along the Yarra River in view of the Central Business District (CBD), in Melbourne, Australia, March 24, 2025. REUTERS/Hollie Adams/File Photo
Australian Treasurer Jim Chalmers poses for a photograph as he arrives to attend a G20 finance ministers' and Central Bank governors' meeting at Gandhinagar, India, July 18, 2023. REUTERS/Amit Dave/File photo
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Overview

  • The 2025 federal budget introduces $17.1 billion in tax cuts, providing $268 in 2026-27 and $536 in 2027-28 for workers earning $45,000 or more.
  • The budget forecasts a $27.6 billion deficit for the current fiscal year, with cumulative deficits of $179.5 billion over five years and gross debt exceeding $1 trillion by 2025-26.
  • Key cost-of-living measures include $8.5 billion for public healthcare, extended energy bill rebates, and reduced pharmaceutical costs.
  • Economic resilience initiatives include $3 billion for green metals production and $20 million for a ‘Buy Australian’ campaign, addressing global trade risks such as potential U.S. tariffs.
  • Positioned as a re-election platform, the budget seeks to balance immediate relief with long-term stability, as the federal election is expected in May 2025.