Retail industry representatives have expressed disappointment with the Australian Federal Budget, claiming it fails to provide adequate support for businesses facing ongoing economic challenges. The Australian Retailers Association (ARA) and National Retail Association (NRA) have both highlighted that while cost-of-living measures may offer some relief to households, the Budget does not address the pressing needs of retailers struggling with slow consumer spending and escalating operational costs.
Fleur Brown, the Chief Industry Affairs Officer at ARA, acknowledged the modest nature of the Budget’s cost-of-living relief, such as increased funding for prescriptions and more bulk-billed GP visits, but stressed that it falls short in providing the necessary support for businesses. “While these measures may provide some confidence, they fail to address the core challenges faced by Australian retailers,” Brown said. “The sector has endured five years of economic uncertainty, and we need targeted measures that help small businesses survive and grow.”
Lindsay Carroll, interim CEO of NRA, shared similar concerns. He noted that although the Budget includes relief measures like childcare support and energy bill subsidies, the retail industry requires long-term solutions, such as incentives for digital transformation and workforce development. “We need more than short-term relief,” Carroll said. “Retailers are under pressure from rising costs and competition from global players who don’t face the same regulatory burdens. Without sustained support, there is little hope for a retail recovery.”
Key aspects of the Budget that may impact retailers include:
- Minor tax relief, including a reduction in the first tax threshold starting July 1, 2026, providing an additional $268 annually for the average worker, rising to $536 by mid-2027.
- Cost-of-living measures such as increased funding for prescriptions, more bulk-billed GP visits, and reduced student debt.
- A guaranteed three days per week of subsidized childcare support.
- An extension of energy bill relief, providing $150 to households and small businesses through the end of 2025.
- A commitment to reduce excessive card surcharges, including the potential ban on debit card fees.
- A $17.1 billion investment over ten years to improve supply chain resilience, including upgrades to key freight routes like Queensland’s Bruce Highway.
However, both the ARA and NRA criticized the lack of substantial measures to support business growth and productivity. “Small businesses are under siege from rising costs,” said Brown. “Rather than reducing red tape, this Budget focuses on increasing it. The uncertainty surrounding the instant asset write-off is particularly troubling.”
Carroll further emphasized the need for comprehensive government action to ensure the survival of the retail sector. “Retailers are facing soaring costs across leasing, energy, transportation, and insurance. They also struggle to compete with international companies that don’t pay taxes or employ Australians. Without a retail recovery, there can be no economic recovery.”
The Australian Food and Grocery Council (AFGC) shared similar concerns regarding the Budget’s focus. While welcoming measures aimed at alleviating household financial strain, the AFGC underscored the importance of a strong, competitive domestic manufacturing sector to ensure continued product availability at affordable prices. The Council called for a cost-of-doing-business agenda that would address financial and regulatory burdens on essential industries, including investment in automation, resilient transport infrastructure, stable energy sources, and solutions to workforce shortages in regional areas.
“The AFGC looks forward to continued collaboration with the government to address both short-term relief and long-term industry resilience,” the statement concluded.
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