2025 ALP Election Policies

The Australian Labor Party (ALP) presented a comprehensive suite of policies during the 2025 federal election, aiming to address key economic, social, and environmental challenges. Certified Practising Accountant Australia (CPA Australia) has provided an analysis of these proposals, highlighting their potential implications for businesses, individuals, and the broader economy.

Business and Industry Initiatives

The ALP’s policies focus on bolstering domestic industries and enhancing economic resilience:

• Instant Asset Write-Off: Extension of the $20,000 instant asset write-off until 30 June 2026, allowing small businesses to immediately deduct eligible asset purchases.
• Penalty Rates Protection: Legislation to safeguard penalty rates in awards, ensuring they cannot be reduced or traded away in enterprise bargaining agreements.
• Response to US Tariffs:
  • Allocation of $50 million to support affected sectors in securing and expanding export markets.
  • Strengthening the anti-dumping regime to protect key industries such as steel, aluminium, and manufacturing.
  • Establishment of a $1 billion Economic Resilience Program through the National Reconstruction Fund, offering zero-interest loans in 2025–26 and 2026–27 to help firms seize new export opportunities.
  • Launch of a $20 million “Buy Australian” campaign to promote locally made products.
  • Creation of a Critical Minerals Strategic Reserve to secure supply chains.
• Non-Compete Clause Ban: From 2027, banning non-compete clauses for workers earning below the Fair Work Act’s high-income threshold (currently $175,000), promoting labor mobility and competition.

Personal Taxation and Financial Measures

To alleviate cost-of-living pressures and simplify tax processes:

• Personal Income Tax Cuts:
  • From 1 July 2026: Reduction of the 16% tax bracket (for incomes between $18,201 and $45,000) to 15%.
  • From 1 July 2027: Further reduction of this rate to 14%.
• Standard Tax Deduction: Introduction of a $1,000 instant deduction for work-related expenses for salary and wage earners. Taxpayers with expenses exceeding this amount can continue to claim as usual.

CPA Australia has expressed reservations about the $1,000 instant tax deduction, cautioning that it may not significantly reduce the need for professional tax advice and could add complexity to the tax system.

Education and Student Loan Reforms

Addressing student debt and repayment thresholds:

• HECS Debt Reduction: From 1 June 2025, all student loan balances (HELP, VET Student Loans, Australian Apprenticeship Loans, etc.) will be reduced by 20%.
• HECS Repayment Threshold Increase: From 1 July 2025, the minimum repayment threshold will be increased from $54,000 to $67,000, easing financial pressure on graduates.

Measures Against Financial Abuse

To protect individuals from economic coercion:

• Preventing perpetrators from using tax and corporate systems to create debts as a form of coercive control.
• Exploring measures to make perpetrators liable for social security debts incurred by victim-survivors due to coercion or financial abuse.
• Investigating ways to prevent perpetrators of domestic and family violence from receiving their victim’s superannuation after death.

CPA Australia has welcomed these initiatives, emphasizing the importance of integrated support, including legal, financial, and emotional assistance for victim-survivors.

Housing Affordability and Support

To assist first home buyers and increase housing supply:

• First Home Buyer Support:
  • Government guarantees for a portion of home loans, enabling purchases with a 5% deposit and no Lenders Mortgage Insurance.
  • Investment of $10 billion to build up to 100,000 homes reserved for first home buyers.

Energy Initiatives

Promoting renewable energy adoption:

• Battery Installation Subsidy: Offering a 30% discount on installed battery costs for households, with small businesses and community facilities also eligible for the subsidy.

Funding and Fiscal Measures

To finance the proposed initiatives:

• International Student Visa Fee Increase: Raising fees by 25% to $2,000, projected to generate $760 million over the forward estimates.
• Public Sector Savings: Reducing spending on consultants, contractors, labor hire, and non-wage expenses, aiming to save $6.4 billion over the forward estimates.

Previously Announced but Unenacted Measures

The ALP plans to implement several measures previously announced:

• Superannuation Tax: Applying a 30% tax rate (up from 15%) on earnings from super balances above $3 million, effective from 1 July 2025.
• Payday Super: From 1 July 2026, employers will be required to pay Superannuation Guarantee contributions to employees with every pay cycle, instead of quarterly.
• Managed Investment Trusts: Clarifying tax rules to ensure trusts owned by a single widely held investor (e.g., foreign pension funds) can access MIT concessions.
• Foreign Resident Capital Gains Tax Reform:
  • Clarifying and broadening the types of assets on which foreign residents are subject to CGT.
  • Amending the point-in-time principal asset test to a 365-day testing period.
  • Requiring foreign residents disposing of shares and other membership interests exceeding $20 million in value to notify the ATO prior to the transaction.

For a detailed overview of these policies and their implications, refer to CPA Australia’s analysis:

Source: CPA Australia