Tax cuts, wage reforms and workforce investment headline a landmark budget built for uncertain times
The Albanese Government has handed down what Treasurer Jim Chalmers has called the most ambitious Federal Budget in decades – and for HR leaders and business executives navigating rising costs, workforce pressure and a volatile global economy, the detail warrants close attention.
Delivered against the backdrop of a Middle East conflict that has pushed oil prices above $100 a barrel and sent inflation forecasts climbing to around 5%, the 2026–27 budget combines sweeping tax reform with productivity measures, wage changes and significant investments in skills and workforce participation.
Now, industry figures are weighing in on the changes. Opinions are divided as some walk away happy and others are left wanting more. A recent poll posted to HRD Australia's LinkedIn captured this sentiment:
Here are the biggest changes affecting HR and what leaders are saying about them.
The centrepiece for employees is a package of five cumulative tax cuts that will leave the average Australian worker on $81,245 up to $2,816 better off annually from 2027–28, compared to 2023–24 settings.
From 1 July 2026, the 16% tax rate on income between $18,201 and $45,000 drops to 15%, falling again to 14% from 1 July 2027. A new Working Australians Tax Offset (WATO) of up to $250 per year kicks in from 2027–28, benefiting more than 13 million workers. Alongside...
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