The Federal Government has once again left businesses wanting, delivering bandaid solutions and marginal economic policy adjustments in this year’s Federal Budget.
Superficial relief for households
Households will see some immediate benefits with a $150 power bill rebate, reduced Pharmaceutical Benefit Scheme medicine costs, and increased funding for bulk-billed GP visits. This is in addition to a change to personal tax rates, with the 16 per cent tax rate that applies to $18,201 and $45,000 dropping to 15 per cent from 1 July 2026, then to 14 per cent from 1 July 2027.
However, the relief remains superficial, offering little meaningful assistance in the face of ongoing challenges of bracket creep, persistent high interest rates, and escalating housing costs.
A lost opportunity for business
For the business community, this represents another lost opportunity to stimulate investment and growth. Absent from the Budget is a vision for addressing critical economic challenges, with no meaningful tax reform and no support to withstand the pressures facing businesses in an increasingly complex global marketplace.
Australia’s gross debt is forecast to be $1,022 billion, representing over 35% of GDP, with a deficit of $42.1 billion projected for 2025-26. The total forecast revenue of $750.3 billion is heavily concentrated, with two-thirds of the nation’s revenue generated from income tax and company and resource rent tax.
The Budget makes no move to expand the instant asset write-off, provides no meaningful levers to support business investment, and does nothing to promote commercial innovation.
As the economy’s resilience wanes, businesses face an increasingly challenging landscape. Extensive red tape and Federal taxes are slowing business activity and reducing available private funding for the commercial sector to invest and innovate. The Budget represents yet another missed opportunity to lift investment confidence and strengthen the economy beyond traditional sectors like mining, building, and infrastructure.
With the nation’s financial position vulnerable to external pressures, overlooking business interests poses significant long-term risks to economic stability and growth.
It’s business investment that holds the key to solving or at least addressing challenges such as housing supply, and ensuring international competitiveness. We continue to hold out hope of seeing Budget policy that is founded on a long term strategic plan for Australia in a complex global economy and encourages long-term sustainable business investment to fulfil to these aspirations.
