A view on the 2025/26 Tasmanian Budget

Introduction

The Tasmanian Budget was handed down by the Treasurer Guy Barnett MP, a member of Tasmanian’s elected Liberal Government.

The 2025-26 Tasmanian Budget is focused on investing and building a better future for Tasmanians, with the aim of ensuring that Tasmania is the best place to live, work, raise a family, invest and do business.^[1]

Tasmania’s total revenue is budgeted to be $9,452.2 million in 2025-26, with a forward estimate of $10,098.9 million in 2028-29. The corresponding total expenses is budgeted to be $10,460.2 million in 2025-26, with a forward estimate of $10,335.0 million in 2028-29.^[2]

The Budget acknowledges the uncertainty surrounding the global economic outlook, which through a change in economic parameters (e.g. employment, wage growth, interest rates, inflation) can result in changes in the state taxation revenue. The reduction in taxation rates and constraints on the revenue base will impact Tasmania’s own source revenue and there is a risk over the budget and forward estimates.^[3]

No major tax measures were announced in the Budget.

Key tax takeaways

Stamp duty

The Stamping Out Stamp Duty policy continues up to 30 June 2026. The policy was introduced in 2024, under which first home buyers of homes with a market value of less than $750,000 do not have to pay stamp duty.^[4]

The pensioners downsizing to a new home duty concession is due to expire 30 June 2025. This concession provides a 50 per cent reduction of property transfer duty for eligible pensioners who sell their former home in Tasmania and downsize by buying another home in Tasmania.^[5]

Short-stay accommodation levy

The Government’s 2024 Election Commitment is progressing to introduce a five percent short-stay accommodation levy. This policy is still in development.^[6]

Payroll Tax

Whilst no changes to the payroll tax regime were announced in the 2025-26 Tasmanian Budget, a number of key observations can be made regarding payroll tax collection and related measures.

• Payroll Tax Revenue: Total revenue from tax transactions was $6.7 million below forecast in 2024-25. However, payroll tax revenue increased by $3.6 million, reflecting ongoing strength in wage growth and employment levels across the state.^[7]
• Increase in payroll tax-free threshold expense: The expense associated with the payroll tax tax-free threshold has increased from $238.5million in the 2024-25 Budget to $268.6million in the 2025-26 Budget, again attributed to continued strong wage growth in Tasmania.^[8]
• Closure of the payroll tax rebate scheme: The payroll tax rebate scheme, which provides payroll tax relief for businesses employing apprentices, trainees and youth employees, is scheduled to conclude on 30 June 2025. Businesses making use of this scheme should plan accordingly.^[9]
• Qantas payroll tax assistance concluded: Payroll tax assistance provided to Qantas Airways Limited has concluded in 2024-25. This support formed part of a broader agreement aimed at retaining Qantas Contact Centre positions in Tasmania and consolidating national operations into the Hobart Contact Centre.^[10]

^[1]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 3).

^[2]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 11).

^[3]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 80).

^[4]Tasmanian Budget 2025-26, Overview (Page 3).

^[5]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 137).

^[6]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 135).

^[7]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 135).

^[8]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 137).

^[9]Tasmanian Budget 2025-26, Budget Paper No.1 (Page 137) and Tasmanian Budget 2025-26, Budget Paper No. 2 (Page 89).

^[10]Tasmanian Budget 2025-26, Budget Paper No. 2 (Page 89).