Election 2025: Labor, Liberals betting the house in hope of victory

Peter Dutton would allow some first-home buyers purchasing new houses to deduct interest payments on their mortgages, as Anthony Albanese offers voters a new tax lure on work expenses and doubles down on Labor’s first-term agenda.

Anthony Albanese with former prime minister Julia Gillard during the Labor campaign launch in Perth, and Peter Dutton comes out fighting at the Liberal launch in western Sydney. Picture: AAP, Richard Dobson/NewsWire

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Peter Dutton would allow some first-home buyers purchasing new houses to deduct interest payments on their mortgages in a pitch to claw back support from suburban Australia, as Anthony Albanese offers voters a new tax lure on work expenses and doubles down on Labor’s first-term agenda.

In a campaign dominated by sugar hits and government-subsidised sweeteners rather than meaningful tax reform or efforts to restore fiscal responsibility, the Prime Minister splashed $10bn on building 100,000 homes for first-time buyers and $2.4bn on automatic tax deductions of up to $1000 for all workers.

The Opposition Leader on Sunday launched the Coalition’s centrepiece $1.25bn housing policy, which will give first-home buyers the ability to deduct interest payments on a mortgage up to $650,000 from their personal tax, handing Australians on the 30 cent tax bracket $60,000 over five years. In addition to the ­Coalition’s $6bn promise to halve fuel excise for 12 months, Mr Dutton also announced a $10bn commitment providing tax relief of up to $1200 for millions of Australians earning below $144,000.

After using their campaign launches in Perth and western Sydney to unveil tens of billions of dollars in new housing, cost-of-living and tax-break measures, the Prime Minister and Opposition Leader came under fire from economists, who warned their “dumb” policies would heap pressure on an already stressed property market and stoke inflation.

Less than three weeks out from the May 3 election, the leaders ramped up the rollout of big-spending populist policies in an ­attempt to woo outer-suburban, first-home buyer and tradie voters.

In front of a crowd of 500 Labor supporters at the Perth Convention Centre, Mr Albanese and Deputy Prime Minister Richard Marles ratcheted up personal ­attacks on Mr Dutton and accused the Liberal leader of stealing Trump-style policies and wanting to “Americanise” Australian services. Mr Albanese, who has consistently linked Mr Dutton to Donald Trump’s policies but is refusing to invoke the US President’s name, suggested that workers in Australia could be exposed to a “wages system where people have to rely on tips to make ends meet”.

With early voting centres opening on April 22 and the election campaign being disrupted by school holidays, Easter and Anzac Day, Mr Dutton has opted for populist policies with broadbased appeal in a last-ditch effort to claw back support.

In contrast to Labor’s slick campaign launch, the Coalition organised a deliberately understated event with no more than 250 people at the Liverpool Catholic Club in the Liberal target seat of Werriwa, previously held by ALP hero Gough Whitlam.

While Labor started its launch with a Welcome to Country, the Coalition event began with frontbencher and Lindsay MP Melissa McIntosh declaring western Sydney was now the heartland of the Liberal Party.

Saying the election was a “sliding doors moment for our country” and that he would soon announce a significant investment in defence, Mr Dutton said the ­Coalition was “ready for government” and the May 3 poll was one that must be won for the good of Australia.

“I say to Australians, it doesn’t have to be like this. There is a clear choice at this election: Between more of the same under Labor – a weaker, less secure, and worse off Australia. Or much needed change under the Coalition – for a stronger, safer, and better Australia,” Mr Dutton said.

Mr Albanese, who is increasingly confident of victory amid polling indicating a plunge in support for the Coalition, was lauded by Mr Marles, Labor minister Anne Aly and West Australian Premier Roger Cook. Julia Gillard was the only former Labor prime minister in attendance.

Anthony Albanese with son Nathan Albanese and Jodie Haydon. Picture: Jason Edwards / NewsWire

Before Mr Albanese’s speech, a video titled This is What We Do was played, which doubled-down on the Albanese government’s industrial relations, climate change, renewables, gender equality and health policy records.

“Labor’s vision for this country, our plan to build Australia’s future, is not about borrowing ideologies or copying policies from anywhere else, or anyone else,” Mr Albanese, who did not mention Indigenous reform or the Uluru Statement from the Heart, said.

“The Liberals want to copy from overseas, Labor stands up for Australia. Growing global demand for clean energy means building more renewables here and now – not waiting two decades for more expensive nuclear power.

“Why on earth would we try to mimic anywhere else? We don’t want a wages system where people have to rely on tips to make ends meet. We don’t want Australian students burdened by a lifetime of debt. And we never, ever, ever want an American-style health system in this country.”

John Howard and Peter Dutton after the Liberal Party Campaign Launch at the Liverpool Catholic Club. Picture: AAP

Veteran economists Chris Richardson and Saul Eslake on Sunday issued warnings about the populist policies being put forward by Labor and the Coalition Mr Richardson said “the campaigns of both major parties are a dumpster fire of dumb stuff … meantime the world is on fire and we here in Australia need smart policies way more than we need smart politics”.

The Rich Insight founder said the Coalition’s “tax cut for a year” coupled with Labor subsidising 5 per cent deposits for first-home buyers were “two different dumbs”. “None of these policies – from either side – actually helps. Inflation is caused by too much money chasing too little stuff. So when politicians give us extra money, that makes the fight against inflation harder and slower than it’d otherwise be,” Mr Richardson said.

“We’ve conditioned the Australian public to believe in this Magic Pudding stuff (rather than focusing on reforms that can help lift productivity – meaning we are simply reallocating shares of the pie, rather than growing it.” Mr Eslake said “both sides of politics are proposing policies that will put upward pressure on housing prices … there must be an election in the offing, oh, yes, of course there is – on 3rd May, I nearly ­forgot”.

Former prime minister Scott Morrison at the Liberal Party campaign launch. Picture: Richard Dobson / NewsWire

Coalition campaign spokesman James Paterson attacked the government’s credibility over its $1000 tax deduction policy, claiming that Labor had cut the standard deduction in the 2012-13 budget to save $2bn.

“Labor promised this once before only to scrap it later when they ran out of money. With Labor you need to look at what they do, not what they say,” he said.

Housing and construction groups endorsed Labor’s housing policies and strongly backed the Coalition’s First Homebuyer Mortgage Deductibility Scheme, which would be accessible to people earning up to $175,000 and joint applicants with combined income of up to $250,000.

Under the scheme, first-home buyers can deduct the interest paid on up to $650,000 of their mortgage from their taxable income.

Someone with a $650,000 mortgage over 30 years and an interest rate of 6.1 per cent would accumulate around $190,000 over a five-year period. The Coalition says an individual in the 30c tax bracket could receive a maximum deduction of around $12,000 per year, or $60,000 over five years.

Anthony Albanese during his speech holds up his Medicare card. Picture: Jason Edwards / NewsWire

Writing in The Australian, Master Builders Australia chief executive Denita Wawn said “this is a tax cut that will help increase the borrowing capacity of aspiring homeowners”.

Housing Industry Association managing director Jocelyn Martin said the Coalition policy and other reforms would help achieve the construction of 1.2 million new homes by 2029. Ms Martin said Labor’s housing announcements would also “increase volume of new home building”.

While Mr Albanese invoked Labor hero Ben Chifley’s declaration that housing was “not only the need but the right of every citizen”, Mr Dutton said he would be the prime minister who “restores the dream of home ownership”.

“I won’t accept a situation in our country where the only people who can buy a home are those who can rely on the bank of mum and dad,” he said.

Despite failing to outline a ­Coalition pathway to a surplus, Mr Dutton accused the Albanese government of delaying interest rate cuts because of its massive spending agenda. “Since coming to power, the Albanese government has lifted spending by a staggering $425bn,” he said.