ELECTION CASH FOR HOUSING; TARIFF PAUSE
Housing loan relief on offer at campaign launches
Labor and the Coalition have put housing affordability at the heart of their official campaign launches, both held on April 13. At his party’s launch in Perth, Prime Minister Anthony Albanese said a re-elected Labor government would give all first-home buyers access to five per cent deposits, with no caps on places or income but higher property price limits. Labor would guarantee a portion of a first-home buyer’s home loan. In Sydney, Coalition leader Peter Dutton told his campaign launch that he would introduce tax deductibility on mortgage interest paid by first-home buyers. Mr Dutton said the Coalition’s First Home Buyer Mortgage Deductibility Scheme would enable buyers to deduct the interest paid on up to $650,000 of their mortgage from their assessable income. The tax incentive would apply only to newly-built houses, with no cap on the overall mortgage size or home price.
Labor, Coalition pledge tax expense write-off, tax offset
Both Labor and the Liberal-National Coalition have pledged minor changes to the tax system to help deliver cost-of-living relief. PM Anthony Albanese and Treasurer Jim Chalmers said Labor would introduce a $1,000 instant tax deduction from 2026-27. They said the reform would allow taxpayers to choose to claim a $1000 instant tax deduction instead of claiming individual work-related expenses. Under the proposed reform, taxpayers would not need to collect receipts for deductions less than $1,000. Meanwhile, Coalition Leader Peter Dutton and Shadow Treasurer Angus Taylor promised a cost-of-living tax offset to more than 10 million taxpayers. Under the plan, eligible Australians earning up to $144,000 would receive up to $1,200 in tax relief when they lodge their tax return, starting from 2025-26.
Trump strikes pause on US tariff regime
US President Donald Trump has imposed a 90-day pause on his proposed wide-ranging global tariff regime. In his Executive Order, the President said that since the tariffs were announced, more than 75 countries had approached the US to “address the lack of reciprocity in our economic relationships”, resulting in the pause. Imports from China, however, would still be subject to tariffs of up to 125 per cent, based on what Mr Trump said was a retaliatory tariff of 84 per cent on imports of US goods.
Treasury’s pre-election caution on trade fallout
Meanwhile, Federal Treasury’s standard pre-election report has warned that escalating trade hostilities has created significant economic uncertainty, exacerbating the risks to Australia’s fiscal and economic outlook. The Pre-election Economic and Fiscal Outlook (PEFO) issued in the second week of the election campaign noted no material changes to the forecasts of the Federal Budget delivered on March 25, but said the increase in recently-announced US tariffs were more significant than expected. Treasury said the direct impact from the nation’s bilateral trade was expected, in aggregate, to be limited, given that the US accounted for 4.6 per cent of Australia’s goods exports in 2024. PEFO report said that particular sectors would be more affected than others; the indirect effects on Australian exports through other trading partners, particularly China, would be larger.
Tariff upheaval not the same as GFC, says RBA head
Reserve Bank of Australia head Michele Bullock says financial market and economic volatility can be expected as countries respond to US tariff announcements and the potential effect on global demand and supply. In a prepared speech, the RBA Governor said it was important to note that there was not the same degree of impact as previous market events, such as in 2008 (year of the global financial crisis). In addition, Ms Bullock said the Australian financial system was strong and well-placed to absorb shocks from abroad. As events unfolded, the RBA would consider several factors, including the response of Australia’s trading partners, additional counter-responses from the US, the response of the exchange rate, and adjustments in other financial markets.
International student arrivals jump 12 per cent
While the political parties debate the level of international students enrolled in Australia, recent official figures for February confirm a strong rise in student arrival numbers. Australian Bureau of Statistics figures reveal that a total 197,270 international students arrived during the month, representing a 12 per cent increase on student arrivals in February 2024. The vast majority of students – almost 167,000 – were enrolled in higher education institutions. Student arrival numbers in February 2025 were 7.3 per cent higher than the pre-Covid levels in February 2019.