Coalition will cut Labor’s waste, cut taxes and tackle the cost of living

Today, the Liberals and Nationals unveil $31 billion in ‘on-budget’ savings.

These savings more than fund the plan to index the income tax brackets through the Tax Back Guarantee and give Australians more of their hard-earned money.

The savings package, covering the four years from 2028-29 to 2031-32, demonstrates how a future Coalition Government would deliver tax relief while repairing the federal Budget.

Under Labor, government spending has hit its highest level outside the pandemic in 40 years, yet Jim Chalmers refuses to put a cap on spending, telling a podcast he was “not prepared to put a specific number on the optimal spending as a share of GDP”.

Anthony Albanese and Jim Chalmers have run out of ideas and have no plan to rein in spending.

The Coalition has done the hard work, found savings to repair the Budget, and deliver lower taxes for Australians. This is part of a real plan to fix the economy and protect our way of life.

The measures would leave the Budget $22 billion better off over the four years, even after accounting for the $20 billion Tax Back Guarantee.

CUTTING WASTE

The $31 billion savings package targets wasteful spending, corporate welfare and Labor’s expanding bureaucracy:

• $9.4 billion from ending Labor’s climate bureaucracy by abolishing the Net Zero Economy Agency, reforming the Australian Renewable Energy Agency, and scrapping electric vehicle tax concessions, the home batteries program, and Scope 3 reporting requirements.
• $7.3 billion from ending corporate welfare, including green hydrogen and aluminium production incentives, critical minerals tax credits, and the National Reconstruction Fund.
• $4.7 billion from scrapping Labor’s failed housing bureaucracy, including Help to Buy, the Housing Australia Future Fund, the New Homes Bonus and Build to Rent incentives.
• $2.0 billion in savings from changes to welfare and NDIS eligibility aimed at putting Australian citizens first.
• $7.9 billion in budget improvements from breaking the illicit tobacco business model.

These sensible and substantial savings are the first step in fixing the Budget and cleaning up Labor’s economic mess, and will help ensure the essential services Australians rely on including schools, hospitals, and aged care places.

CUTTING INCOME TAX

Labor plans to raise taxes on Australians to pay for its out-of-control spending, as shown in the recent 2026-27 Budget. The Coalition will instead cut wasteful spending and hand those taxes back to households.

The Coalition’s Tax Back Guarantee, which would replace the WATO, would instead rise year after year, to $500, then $750, then $1,000, and so on. Over ten years, a typical taxpayer would pay around $14,000 less in tax compared to Labor’s plan.

Unlike Labor, the Coalition understands that cutting wasteful government spending can cut income taxes and take pressure off inflation and interest rates.

RESTORING BUDGET DISCIPLINE

These savings measures follow the Coalition’s commitment to revitalise the Charter of Budget Honesty by pledging to reimpose a binding cap on taxes, to restrain government spending growth to less than economic growth, and to target a return to surplus.

The Coalition will also establish a Future Generations Fund, quarantining 80 per cent of commodity revenue windfalls to pay down debt and invest in productivity-enhancing infrastructure.

Rather than blowing revenue windfalls on wasteful spending as Labor has done, we will use them to strengthen Australia’s financial position and build the infrastructure our country needs for the future.

The Coalition is determined to deliver genuine savings, fiscal responsibility, and a stronger bottom line after years of falling living standards and government waste under Labor.

Quotes attributable to the Leader of the Opposition, Angus Taylor MP:

“Because Labor can’t manage money, Australian families and small businesses are paying more for everything.

“All Anthony Albanese and Jim Chalmers have to offer is more taxes and more spending. This just means higher inflation, higher interest rates, more debt, and more deficits.”

“The Coalition has cleaned up Labor’s economic mess before, and we’ll do it again. We will get spending under control, cut Labor’s waste, and let Australian families and small businesses keep more of what they earn.”

“A Taylor-Canavan Government will deliver $20 billion in tax cuts to put more of Australians’ hard-earned money back in their pockets. For a typical workers, this means an extra $250 in their pocket in the first year, rising to $500 in the second, $750 in the third, and $1,000 in the fourth”

“The Coalition’s Plan to Fix the Economy and Protect Our Way of Life will deliver lower taxes, cheaper power, less migration, and more homes for Australians.”

Quotes attributable to the Deputy Leader of the Opposition and Acting Shadow Minister for Finance, Senator Jane Hume:

“Taxpayers shouldn’t be bankrolling billions in corporate handouts while Labor goes after senior Australians, families and small business.”

“Every dollar the government spends comes from the pocket of a taxpayer. We need to get back to the basic principle that governments should spend money carefully, not throw it around like it’s their own.”

“Fixing the Budget means having the courage to make tough decisions. Australians know that public spending is adding to inflation, but Labor continues to spend without restraint.”

Quotes attributable to the Shadow Treasurer, Tim Wilson MP:

“Our taxaholic Treasurer is addicted to spending and inflation, and we will kick his habit so we can get interest rates down and the prices at the supermarket.”

“You can’t tax your way to prosperity or spend your way out of a spending problem. We’re cutting Labor’s waste so hardworking Australians can keep more of what they earn.”

“While Jim Chalmers keeps finding new ways to spend taxpayers’ money, we’ve found billions in savings to fund tax relief and improve the Budget bottom line.”

“Anyone can promise lower taxes. The real test is whether you can pay for them. Unlike Labor and One Nation, the Coalition is putting its numbers on the table and showing Australians we’re serious about economic management.”

Table 1: Budget impact of savings and tax relief ($ BILLIONS)