Labor will forge the next parliament of Australia after winning the 2022 federal election, thus the implementation of Labor policies will follow.
But what does Labor leader Anthony Albanese’s historic win mean for Aussies already feeling the pinch as our cost of living crisis rages on?
According to H&R Block’s director of tax communications, Mark Chapman, the change in government could impact household finances.
What does it mean for your bottom line?
Home Buyers Labor policies
Labor has created their scheme, called ‘Help to Buy’, which is not restricted to first home buyers like the Liberal policy was. Eligible buyers will only require a 2% deposit and will not have to pay lenders mortgage insurance.
The Labor party will acquire an equity stake of up to 40% in the home, which the buyer will then get back in capital gains once the house is sold. The owner must reside in the home for a minimum of two years, and property price caps are also inapplicable.
Labor will initiate their ‘Regional First Home Buyers Support Scheme’ in regional areas for 10,000 first home buyers a year. Their policy doesn’t demand the home to be a new build, and existing houses and the scheme will include townhouses and units.
They will also improve the overall first home buyers scheme, declaring to update property price caps every six months and be more effective at reallocating unused guarantees to those who will use them.
Small Businesses Labor policies
The Labor party professes that eight out of 10 small businesses find government regulation convoluted, so they are concentrating on collaboration between government and small businesses. They want small businesses to spend less time doing taxes and regulative paperwork.
Labor aims to maximise the amount that small businesses receive from the Commonwealth Procurement. The Commonwealth has $190 billion to assist small businesses and stimulate economic growth.
Labour has also stated that it will provide more clarity for small businesses in times of crisis (bushfires, floods, pandemics).
Labor has stated they will not increase taxes and have no proposal in place. Instead, just as they stated for small businesses, they’re looking to provide more clarity on tax to families, with a critical goal to ensure Australia’s economy helps working families.
The Labor Party have pledged to deliver tax relief for more than 9 million Australians through tax cuts that benefit those with incomes above $45,000.
They will address cost-of-living relief for Australians by increasing the low-and-middle-income tax offset by $420 this year.
Aged care Labor policies
Labor’s aged care policy focuses on five main areas.
It promises to have a registered nurse on-site at all times of the day. According to the aged care royal commission’s recommendation, staff are required to spend a minimum of three hours and 35 minutes with each resident.
Labor has not yet specified how many minutes each resident would have with a registered nurse per day but stated each resident would receive “more time with a registered nurse”.
The policy said it would deliver more staff to the sector and says Labor supports the push for increased workers’ wages and will fund any increase in whole.
Labor claims it will create a National Anti-Corruption Commission by the
year-end. Which is intended to cover alleged corruption by public servants and politicians.
Labor’s model is designed to have public hearings for everyone, including politicians, unless there were a valid reason not to.
The commission would have the power to start its investigations and not wait for a matter to be referred.
It would also be able to investigate matters that happened in the past.
Childcare Labor policies
Labor promised more generous subsidies across the childcare sector, including confirmation of the government’s changes for additional children.
It would also increase the maximum subsidy rate to cap it at 90% for the first child in care.
Labor’s long term goal is to provide a universal, 90% subsidy to all families.
The family income threshold would be raised from $354,305 to $530,000, and there would be no annual cap.
The proposed changes would cost $5.4 billion over four years.
Labor is promising to implement tax breaks for electric cars, saving people approximately $2,000 on a $50,000 vehicle.
Over three years, the policy would cost $200 million. It would work by exempting some electric vehicles from import tariffs and fringe benefits tax, if they are below the luxury-car tax threshold of $79,659.
If businesses issued the same car to an employee via a work scheme, the company could offset up to $9,000 a year.
The discount would begin from July 2022 and be reviewed in three years to reassess the take-up down the track.
Health Labor policies
Additionally, it promised to fund 50 “urgent care clinics”, which it says will take the pressure off hospital emergency departments.
The clinics will cost $135 million over four years based on GP surgeries and centres. The clinics will be open seven days a week from 8am to 10pm.
Labor has also promised to match the Coalition’s continuous glucose monitoring device and Seniors Health Card expansion promises.
Increase manufacturing in Australia
Labor proclaims it has a “comprehensive” plan to rehabilitate manufacturing in Australia instead of directing it offshore.
It committed to providing up to $15 billion of capital to invest in job-creating projects via loans, equity, agriculture transport, defence capability, medical science, renewables and low emissions technologies.
Mr Albanese also wants additional trains, ferries, and trams built in Australia.
Labor pledges $270 billion in defence to protect Australians and keep the region peaceful.
“By maximising local content, we will create jobs and establish a local defence manufacturing sector,” their website states.
Climate change Labor policies
Labor has committed to a 2030 target of 43% net zero emissions by 2050 and the plan includes investing in green metal production, which concerns metals produced using renewable energy. The intent is to make electric cars cheaper, upgrade the electricity grid to handle more renewable energy, and install community batteries and solar banks around the country.
Superannuation Labor policies
The age will be lower for making downsizing contributions to superannuation. Labor agreed to match the Coalition’s proposal, which will see Australians over the age of 55 able to invest up to $300,000 into their superannuation from the sale of their home. The current age limit is 65, but that was already set to drop to 60 from 1 July 2022.
Vogue Advisory Group – helping you understand how politics impact finance
If you have any questions or concerns about how new policies will impact your finances, please contact us and one of our financial advisers will assist you.