Australia’s Budget Raises Passenger Charge, Funds Keytruda for Cervical Cancer, and Cuts Nearly 500 Tariffs

TL;DR: Australia’s 2025‑26 budget raises the Passenger Movement Charge from $70 to $80 for outbound travelers, lists Merck’s Keytruda on the PBS for cervical cancer, and abolishes 497 nuisance tariffs, trimming government revenue by $70 million over five years.

Context The budget directs billions to fuel resilience, tax cuts, hospital and aged‑care funding, and reforms to negative gearing, capital gains tax and family trusts. It also allocates money for electronic screens at sporting grounds, new e‑bike standards, tax exemptions for the incoming Papua New Guinean NRL team, and the wharf repair program at the Australian National Maritime Museum.

Key Facts From January 2027 the Passenger Movement Charge payable by air and sea travelers leaving Australia will increase by $10, moving from $70 to $80. The charge is embedded in airline tickets and is expected to raise additional revenue for aviation consumer protection and noise monitoring. In 2025 Australia recorded 946 new cases of cervical cancer; the budget states that listing Keytruda on the Pharmaceutical Benefits Scheme will reduce the out‑of‑pocket cost from $15,000 per script to a subsidised amount. Merck (MRK) closed at $112.40, up 0.9% on the day, with a market capitalisation of approximately $202 billion. The government will abolish 497 nuisance tariffs on items such as wine glasses, tyres, air conditioners, margarine and bitumen, a move projected to cut revenue by $70 million over five years. Treasury Wine Estates (TWE.AX) rose 0.4% to $9.22, giving it a market cap of about $8.1 billion, while Qantas (QAN.AX) slipped 0.3% to $6.48, valuing the carrier at roughly $12.0 billion.

What It Means The higher passenger charge adds roughly $10 to each outbound ticket, which airlines will likely pass through to travelers, potentially dampening demand for discretionary travel. Listing Keytruda on the PBS expands access to an effective immunotherapy for cervical cancer patients, aligning with the 946 diagnoses reported in 2025 and reducing financial barriers. Removing the 497 low‑yield tariffs lowers compliance costs for importers of the affected goods, which could translate into modest price reductions for consumers and marginally improve margins for companies like Treasury Wine Estates. The combined fiscal impact is a modest revenue loss offset by savings from reduced tariff administration and potential health‑system efficiencies.

Watch for the implementation of the passenger charge increase in early 2027, any further PBS listings for oncology drugs, and industry feedback on the tariff repeal as importers adjust supply chains.