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💡Key Insight
- Navigating the 2025-26 Federal Budget for small business owners involves understanding how budget measures may affect cost structures, access to grants, and regulatory compliance, particularly in areas like wage laws, financial support and digital transition.
- Small businesses are expected to see continued policy focus on easing economic pressures, including tailored support to manage borrowing costs and incentivise growth through innovation funding.
- Budget projections also consider structural changes like digital payment evolution and broader economic resilience strategies that could influence operational planning and investment priorities.
- Staying informed on budget announcements and subsequent legislation helps small business owners align strategy with emerging opportunities and regulatory expectations.
The Federal Budget lands on March 25th, and as a small business owner, understanding its implications could be crucial for your planning. With the government likely to announce measures addressing cost of living pressures and business growth initiatives, now is the time to prepare for potential changes.
From tax adjustments to innovation funding and industry-specific support, this pre-election budget will shape the business landscape for the coming year. We’ve outlined the key areas to monitor so you can position your business strategically, whatever announcements may come.
Table of Contents
The 2024-2025 Federal Budget, In Retrospect
The 2024-2025 Federal Budget was delivered on the 14th of May 2024. The main aims of the 2024-2025 budget were to ease cost of living pressures, build more homes for Australians, invest in developing skills of high demand, strengthen Medicare and advance equality for women, Aboriginal and Torres Strait Islands, and those most vulnerable within Australia.
98% of Australian businesses are small businesses and ultimately shape the framework for a lot of where the government allocates its funding and investment.
Key actions in the budget to assist with these aims included:
- Support for small businesses through $641.4 million in targeted support.
- Investing $6.2 billion in housing initiatives.
- Tax cuts for all 13.6 million tax paying Australians to alleviate cost of living pressures.
- Power Bill Relief which gave over 10 million households a rebate of $300.
- Support for renters through providing $1.9 billion to increase maximum rates of Commonwealth Rent Assistance.
- Cutting $3 billion in HECS debt, assisting over 3 million Australians.
- Investing in renewable energy, science and technology and financial assistance for women, Aboriginal and Torres Strait Islanders, and those with a disability.
What to Expect in the 2025-2026 Federal Budget
The previous Federal Budgets have been centred around minimising the costs of living and contributing to assisting small to medium businesses within Australia. As the budget will be announced on March 25th, there is no confirmation of the government’s financial allocations until then.
However, there are some predictions and estimates of the themes and values the budget will reflect, through assessing Australia’s current economic outlook and key legislative changes relating to financial changes and specifics that relate to small to medium enterprises within Australia.
Assistance for Small Businesses in Australia
Small businesses in Australia are the backbone of the nation’s economy, making up 98% of all businesses within Australia. A large portion of the budget is delegated to helping small businesses. Last Federal Budget, eligible small businesses received a $325 rebate on their electricity bills throughout the year.
This upcoming budget, this financial support is likely to continue. This is likely to be reflected through injecting more cash into these existing avenues to assist small businesses and through developing more business grants and vouchers.
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What About Interest Rates?
Interest rates are a crucial factor for both small businesses and households in Australia, and their role in the 2025-26 Federal Budget will likely be closely scrutinised. With the Reserve Bank of Australia’s ongoing efforts to manage inflation, any movements in interest rates can have a significant impact on borrowing costs for businesses and individuals alike.
The upcoming budget may outline further measures to address rising interest rates, potentially including targeted support for businesses facing higher borrowing costs or those struggling with financing challenges. Additionally, small businesses may see a continuation of initiatives aimed at easing the impact of higher rates, such as access to low-interest loans or grants for innovation and expansion.
The Criminalisation of Wage Theft
As of 1 January 2025, intentional underpayments of an employee’s wages or entitlements will become a criminal offence in Australia. These laws have been introduced as a mechanism to ensure fair treatment of workers and deter non-compliance within all sectors Australia-wide.
To support small businesses in meeting these new legal obligations, the Voluntary Small Business Wage Compliance Code has been introduced. This Code offers a clear framework for small business employers, providing guidelines on how to ensure they are paying employees correctly and avoiding unintentional breaches.
Phasing Out Cheques
Australia has implemented a cheque transition plan, aiming to eradicate the usage of cheques by 2030. This effort comes as a way to better streamline the processes that exist within the financial industry and digitalising most services relating to transferring of funds.
The government is taking a leading role in working across industries to support all Australians by ensuring cheque end users receive the assistance they need to transition to other payment methods.
The Road Ahead
The 2025-26 Federal Budget is set to be a game-changer, focusing on easing financial pressures and setting businesses up for success in a shifting economy. It’s all about making sure Australians, especially small business owners, have the support they need to thrive despite challenges like rising interest rates.
As the government continues to steer its efforts toward innovation and stability, this budget will likely pave the way for a stronger, more resilient future. So, staying ahead of the curve will be key for those looking to make the most of the opportunities that lie ahead.
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