Labor's fifth budget tips the scales in favour of younger and less well-off households, but offers little for middle-aged, middle-income Australians increasingly drawn to populist parties like One Nation, according to distributional analysis from the ANU's Centre for Social Policy Research.
Budget Winners and Losers
The analysis, conducted by associate professor Ben Phillips, shows that the budget measures—including scaling back the capital gains tax discount, removing negative gearing for landlords, and a minimum 30% tax rate on discretionary trust income—will reduce annual earnings for the richest 20% of households by about $1,500, while boosting the poorest households by a few hundred dollars.
By age group, Gen Z and millennials see an average annual income boost of $300 to $400, while boomers over 65 suffer a $500 to $1,000 hit. Households relying on investment income face a $2,400 reduction, while others see negligible changes.
Limited Impact for Most
Despite the rhetoric, Phillips notes the overall impact is modest. "The budget has been reasonably progressive, but not transformative," he says. For most Australians, the effect on living standards is only 1% to 1.5%, as few have negatively geared property or use trusts.
Middle-class Gen X households, who are increasingly turning to One Nation, also feel the squeeze as millennials benefit at boomers' expense. Treasurer Jim Chalmers has signaled broader income tax cuts for this group before the next election, calling the $250 working Australian tax offset a "down payment."
Geographic Disparities
Residents in wealthier Sydney and Perth suburbs take the biggest hit, while low-income areas like western Sydney see little benefit, despite high rates of housing stress and poverty.
