Federal election 2025: All the cost-of-living pitches from Labor, the Coalition

With cost-of-living shaping to be the dominant election issue, here’s what the major parties are promising to help ease your budget bottom line.

With cost-of-living set to be the number one election issue facing voters, both major parties are pitching themselves as the side most capable of handling Australia’s economy.

With households battered by surging inflation and high interest rates, Labor has branded itself as the party which delivered two back-to-back surpluses, while delivering budget relief for Australian families.

On the other hand, the Coalition, led by Peter Dutton, has taken aim at increased government spending, claiming it has prolonged inflation and subsequently heightened interest rates, with the cash rate currently sitting at 4.1 per cent following its first cut since November 2020.

When it comes to who’s doing what to help your household’s budget bottom line, here’s what both major parties are pledging.

What they agree on:

Bipartisan support for beer tax freeze: The Coalition has backed Labor’s position to freeze the alcohol excise on draught beer for two years, starting from August 1, 2025. While the much-hated tax adds about 1-2 cents per pint bought at the pub, it will aid brewers and publicans.

$8.5bn to boost bulk-billing: The Coalition will also match Labor’s $8.5bn Medicare pledge aimed at supercharging bulk-billing rates at GPs.

$150 energy rebate: Both parties have agreed to extend energy bill rebates for all households until the end of 2025, saving $150 per household at a cost of $1.8bn.

Both major parties have vowed to commit $8.5bn to increase bulk-billing rates across the country. Picture: NewsWire/ Martin Ollman

Labor

HECS cuts: Effective from June 1, 2025, the government will implement a 20 per cent reduction on all student loan debts, including HELP, VET Student Loans, and Australian Apprenticeship Support Loans.

It is expected to eliminate approximately $16bn in student debt, benefiting around 3 million Australians. A graduate with an average HELP debt of $27,600 will see about $5,520 wiped from their outstanding loan.

Increased HELP repayment thresholds: Starting in the 2025-26 financial year, the minimum income threshold for compulsory student loan repayments will rise from approximately $54,000 to $67,000.

Additionally, repayments will be calculated based on the portion of income above this new threshold. For example, an individual earning $70,000 will pay around $1,300 less per year in repayments under this new system.

Tax Cuts: In the 2025 federal budget, Treasurer Jim Chalmers announced two new tax cuts to the lowest bracket, with the rate to drop from 16 per cent to 15 per cent from July 1, 2026, and to 14 per cent in 2027-28. The cut, which was legislated one day after the budget was handed down, would be permanent and equate to a saving of about $10 a week for the average earner once both cuts have flowed through.

These cuts aim to help with cost-of-living pressures while helping to avoid bracket creep.

The Coalition has declared it would repeal the changes if elected.

Cheaper Childcare: While Labor has already passed legislation to guarantee all households with a combined income of up to $533,280 will receive a minimum three days of subsidised childcare, with Labor also promising a $1bn fund to build more than 160 new centres.

Cheaper childcare, slashed HECS debts and more bulk-billing clinics have made up the cornerstone of Labor’s cost-of-living election policy. Picture: NewsWire/ Brenton Edwards

Extended paid parental leave: The government has extended paid parental leave, providing additional financial support to new parents during the critical early months of their child’s life.

From July 1, 2025, parents will be eligible for 25 weeks of paid parental leave, which will increase again to 26 weeks from July 1 2026.

Fee-Free TAFE: The government has expanded access to vocational education by offering fee-free TAFE courses, enabling more Australians to gain skills and qualifications without the burden of course fees.

$10k apprenticeship bonuses: To address skill shortages and support apprentices, the government introduced a $10,000 wage bonus for apprentices in priority occupations.

Food Security Measures: The government announced a $3.5m plan to enhance food security and supply chains, aiming to reduce the costs of 30 essential products in 21 remote communities and 10 regional forums across Australia.

Boost to urgent care clinics: A re-elected Labor government has pledged $644m to increase the number of Medicare urgent care clinics from 87 to 137. The new clinics have been slated to every state and territory.

Help to Buy: The government committed another $800m in the 2025 federal budget to lift property price and income caps on its Help to Buy scheme, which contributes equity of up to 40 per cent to support eligible homebuyers.

The Coalition

No tax cuts: Peter Dutton has confirmed the Coalition won’t be promising income tax cuts, saying the budget makes it impossible to do so responsibly. He’s also promised to repeal the $10 tax cuts announced in the March 25 budget.

Fuel excise cut: Instead, he has vowed to cut the fuel excise in half for 12 months starting in July if elected. This would slash about 25c per litre off petrol costs, at a cost of about $6 billion.

Superannuation for housing: A Coalition government would allow people to take from their superannuation accounts for a house deposit, a measure it says will specifically help first homebuyers and older women. The Coalition has also vowed to maintain the Home Guarantee Scheme program, which includes a 5 per cent deposit program for up to 35,000 first homebuyers, and another 10,000 specifically for those buying in a regional area, as well as a 2 per cent deposit scheme for 5000 single parents or eligible single legal guardians with at least one dependent.

Tax breaks for small businesses: Small businesses with an annual turnover of less than $10m will be able to access up to $20,000 in tax deductions for meal and entertainment expenses.

Increase to psychology sessions: Australians who have a mental health care plan will be able to access 20 Medicare-subsidised psychology sessions, an increase from the current 10. The appointments were doubled during the pandemic.

Peter Dutton has promised all small businesses will be able to deduct up to $20,000 to spend on meal and entertainment expenses. Picture: NewsWire/ Roy VanDerVegt

Supermarket giants on notice: Mr Dutton will equip the ACCC with divestiture powers to break up supermarket duopolies if they are found to be price gouging, or using their market share to dud producers and farmers.

The Coalition has also pledged to introduce a Supermarket Commissioner to enforce the Food and Grocery Code.

Insurers warned over hikes: Insurance giants have also been put on notice, with Mr Dutton threatening companies with divestiture over premium increases for households and businesses in areas prone to natural disasters.

Instant asset write offs expanded: Currently $20,000, the instant asset write off will be extended to $30,000 for small and medium businesses if the Coalition wins government. This would applies to depreciating assets with a cost of less than $30,000.

Public spending overhaul: While light on details, the Coalition has said it will rein in “wasteful government spending”, declaring such cuts would bring down interest rates.

Originally published as Federal election 2025: All the cost-of-living pitches from Labor, the Coalition