💰 The Budget just boosted your borrowing power

Most of the budget headlines were about EVs and fuel prices. But there's a change in the fine print that matters more to anyone thinking about car finance.

From July 1, the tax rate on income between $18,201 and $45,000 drops from 16% to 15%. In July 2027, it falls again to 14%. Stack in the new $250 Working Australians Tax Offset arriving in 2027-28, and an average full-time worker is up to $2,816 a year better off once all scheduled cuts are in place. There's also a $1,000 instant work expense deduction landing this financial year. No receipts, no itemising, just a flat deduction.

That sounds like a modest pay rise. Here's why it's more interesting than it looks.

Lenders calculate your borrowing capacity based on your net income after tax and committed expenses. When your tax rate drops, that net figure rises, even if your salary hasn't changed. A borrower on $55,000 will have a higher assessed capacity on July 1 than they did last month. Not dramatically higher. But enough to shift the outcome if you're sitting just inside a lender's margins.

Here's what that means for you: if the numbers didn't quite work when you last looked at finance, they may look different from July 1. Your take-home goes up. Your lender's reading of what you can comfortably repay goes up with it.

Worth running the numbers again before the end of the financial year. Read the full budget breakdown

📋 The most common question we're getting right now

"Is there anything I can do about my repayments?"

With the cash rate at 4.35%, it's the conversation we keep having. Honest answer: yes, but the right move depends on your situation.

Refinancing is the obvious lever. A $30,000 loan at 8% over seven years runs $9,075 in total interest. At a sharper rate, or a shorter term, that number changes significantly. But refinancing only stacks up if the new rate genuinely beats the old one after exit fees and setup costs.

There are six other options worth knowing about: extending your loan term to reduce monthly payments (you'll pay more interest overall, so weigh it carefully), adding a balloon payment, putting a lump sum directly against the principal, improving your credit profile before your next application, and asking your lender about hardship arrangements if things are genuinely tight.

The question to ask yourself before making any change: does this make this month easier at the cost of more interest over the life of the loan? The guide walks through when each option actually makes sense. Read the full guide

⛽ Petrol is about to get more expensive. Prepare now.

The temporary fuel excise cut that's been saving you roughly $13 per tank ends on July 1. No extension was announced in the budget.

Since April, excise on petrol and diesel has been charged at 20.6 cents per litre rather than the usual 52.6 cents. That 32 cent per litre difference comes back on in full from July 1. A 50 litre fill costing around $110 today will likely run closer to $123 next month, assuming global oil prices hold roughly where they are.

If you drive regularly, budget for the jump now. The window to fill at discount prices closes at the end of June. More from CarExpert

The Gusto family

→ Gusto Home Loans — We do for home loans what we do for car finance. Buying, refinancing, or just want to know your borrowing power. Our team compares options across a large lender panel.

→ Gusto Auto — Our Brisbane-based used car dealership. Buy a quality used car directly from us while Gusto Finance handles the loan.

→ Gusto Cash — Need funds fast? Flexible personal cash loans for when life happens outside a standard car or home loan.

The Gusto Finance Team