Treasury Laws Amendment (Tax Reform No. 1) Bill 2026, Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026

Mr PIKE (Bowman) (12:31): The previous speaker spoke to that great Australian promise that I think has probably existed since 1788: that each generation of Australians is able to pass down to their children a stronger and more prosperous nation. We've had our fair share of challenges in this country. We've been through world wars.

We've been through depressions. We've been through gold rushes and we've been through economic collapses. But it has always been the experience in Australia that each generation can, despite those challenges, pass on to their children a stronger, more prosperous, better country and that each generation of Australians can expect, as the previous speaker said, that little bit more than what their parents were able to achieve.

But I think all members here, if they were honest with themselves, would appreciate that probably this is the first generation—certainly in my view—where we can't actually make that promise to our children. The aspiration of homeownership is beyond the reach of too many Australians. Economically, we don't have the same opportunities that I think previous generations had, and I fear that my nine-year-old and my six-year-old will not be able to enjoy the same economic opportunities we've been able to enjoy.

The question before the House, and probably more so in this bill than in any other legislation I've seen in my four years here, is: how do we actually deal with that? Do we start to rejig tax settings and decide on different ways to share the pie? Or do we try to actually grow the pie?

Can we grow the Australian economy? Can we create more wealth here? Can we get to a point where Australia is charging ahead with so much prosperity that we are seeing more opportunity created?

I think that's where the fundamental difference is between both sides of this chamber. On my side we're of the view that we should be trying to supercharge small business in this country. We should be giving them more opportunity, more benefits, more capacity or more confidence to invest and create jobs and wealth.

Unfortunately, what we see through these changes is the exact opposite, and we think this is completely the wrong direction. Let me start by, firstly, making some comments on the broken promise that this bill represents. A lot has been made in this chamber, and outside it, of the very nature of the fact that the Prime Minister promised so many different times that these tax changes wouldn't be implemented.

We remember the 2019 election, when these tax changes were a prominent part of the Labor government's election platform and they suffered a defeat. This is one of the main areas that people point to now and say that they lost the 2019 election because of these and other tax changes they were trying to implement. There is a distinct reason why so many frontbenchers, including the Prime Minister, were at pains to say in the lead-up to the last election, 'No, no, no—we wouldn't be possibly be bringing in changes to negative gearing or to CGT.' Well, here we are.

I think it's incredibly disappointing for the dignity of this House that we have such a blatant distance—I want to be careful with my language here, because I don't want to be unparliamentary—between what was said before the election and what's being implemented now. I don't think it reflects well on any of us. I pointed out the fact that I feel this is an assault to aspiration.

At a point when we should be encouraging business growth, the ultimate outcome of these changes will be $77 billion in higher taxes. When those opposite talk about trying to implement very, very modest tax changes or very, very modest tax cuts through this bill, we need to point out that headline: $77 billion in higher taxes. The Prime Minister has also confirmed that we'll potentially see $273 billion in taxes that Australians didn't vote for over the next nine years.

In relation to the specific provisions within this bill, schedule 1 introduces changes to the CGT regime. The coalition opposes those. Schedule 2 introduces changes to the negative gearing regime, and the coalition opposes those as well.

Schedule 3 introduces the working Australians tax offset. We support that. Schedule 4 introduces the $1,000 standard deduction for work related expenses.

That's another measure that we support. A lot has been said by previous speakers, and I won't dwell on the point that this bill has obviously been glued together in order to try to create a wedge. However, in its totality, we cannot support this bill because of the massive increases in taxes that we're going to see.

We're going to see a death tax. We're going to see taxes on family savings. We're going to see taxes on renters, first home buyers and young Australians trying to get ahead.

We're going to see taxes on small businesses, startups and entrepreneurs—the people who are the very engine room of the Australian economy. I want to speak on a couple of emails that I've received in my electorate office from local business owners on their response to this budget. I have an email from Nick.

I won't mention Nick's business, but it is in a sector where Australia is not competing very well, and he's an individual who is creating employment in the Redlands in a very, very difficult industry. I'll read directly from it: Quite simply, the changes to CGT and trusts will have a devastating impact to our business. All these years we have played by the rules, paid our taxes along the way and now the government wants to completely change the game, never mind the rules of the game.

The change to trusts means that we now must consider possible changes to our corporate structure, but no matter what changes we make, the result will be higher taxes. It is completely unfair to introduce what is effectively double taxation on discretionary trusts. We are already being taxed at the company rate so why should distributions to a company be taxed a second time?

It's not like multinational companies moving profits offshore to avoid tax—we have paid tax all these years, and we are in an extremely competitive industry where we cannot increase margins to adjust to this extra tax grab. He goes on to say: To put it bluntly, this budget has us seriously considering selling or even closing the business before June next year as there is no longer any reward for ingenuity, hard work, or effort.

I think that sums it up incredibly well. I've also got a note here from Mark, who runs another business in my electorate that I won't name. He says: Day in, day out, small business owners are the ones putting everything on the line.

We're the ones taking risks, creating jobs, backing ourselves, and trying to build something meaningful not just for ourselves, but for our staff, our families, and the broader community. … … … When you start talking about changes to things like CGT and trust structures, it sends a pretty clear signal: that long-term effort, delayed gratification, and building something over time are no longer being encouraged but are instead being targeted.

That's always been my biggest concern when I go around my electorate. When I doorknock local businesses and I ask them about their outlook, I ask them, 'What's the next challenge for you guys?' Over the course of the last four years, I have gotten disheartening responses where people just tell me it's not worth the risk anymore. This just doubles down on that general sense of: 'Why am I taking these risks?

Where's the reward? It's not worth it anymore.' That, of course, is terrible news for the Australian economy. We'll put aside the business stuff for a moment.

I want to talk about the impact on housing. The government's own budget papers say that this will produce 35,000 fewer homes. That'll be a direct consequence of these new taxes.

So, when those opposite talk about wanting to ensure that first home buyers or aspirants can get their first step on that property ladder, I ask: can you explain to me the economics of the situation where if you have 35,000 fewer homes we're going to end up with more opportunity? I'll also note that we had an interesting joint statement last Friday from the Property Council, the Real Estate Institute of Australia and Master Builders Australia.

They've taken their own analysis of what the impact of these changes will mean for the sector that they represent. If I can be entirely honest, I think I've got more faith in their capacity to tell me the impact than I do in the government. They said: … the Federal Budget will see new home construction go backwards, and higher than anticipated rental inflation.

Their modelling, which only goes for four years, says that the federal budget will cause new supply to fall by over 8,700 homes in that four-year period. Rents will increase $9 per week. There will be a reduction in the GDP of $864 million.

On the day we're getting our national accounts figures, that should alarm everyone. They also say that construction jobs are to fall by 3,800. These do differ from Treasury's results, which are representing a more modest impact, but I think that that makes for quite sober reading.

Also, in the budget papers, it makes it clear we're not just going to get fewer homes. We're actually going to get higher rents. They acknowledge that in Budget Paper No. 1.

To me, that isn't about intergenerational fairness. What that's actually doing is pulling up the ladder of opportunity for young Australians. It's not just about those young Australians who want to get their first step on the housing ladder.

It's also about those Australians, and many of them aren't property moguls by any stretch of the imagination. When you look at the ATO lists of the occupations most likely to utilise negative gearing, right up the top there are police officers and nurses—the sort of people who we expect the Labor Party usually would advocate on behalf of. These are the people who are utilising this tax arrangement to try to do the right thing, build their wealth and set their family up for a position where they're going to have a comfortable retirement.

Instead, all this does is bake in the advantage that those who've been able to utilise these arrangements have been able to enjoy for many decades and pulls the ladder up on that next generation of aspirational Australians. People talk about the impact of negative gearing. Negative gearing has been part of our tax system for a very long time, long before we had a housing crisis.

The problem is supply and the problem is demand. We've allowed too many people to come to this country without homes for them to live in, and that's why the coalition has adopted a policy that the opposition leader outlined in the budget-in-reply. We're going to peg those two figures together.

We're only going to let in enough Australians to meet the— Mr Holzberger: If housing goes up, does migration go up too? Mr PIKE: Well, we're going to allow demand to meet housing supply. And, of course, we're going to have to keep that significantly lower than that figure over that period of time because we've got so much to catch up.

I'm interested in the interjections from the member for Forde, and I'm wondering whether he's actually made any attempts to sell the budget within his electorate, because I know that there are so many wonderful small businesses in his neck of the woods who would be very devastated about that. I wonder whether the member for Forde is one of those Labor backbenchers who's taken the opportunity to turn off all his comments on every social media post because he's so tired of the backlash that he's been receiving.

It's very interesting. I've talked about the migration figures, but, unfortunately, the budget also reveals that the government's going to overshoot their migration target by 90,000 people. That's nearly the size of a federal electorate.

It's probably bigger than a federal electorate in Tasmania. That's a significant number of people, and you add that on top of the 1.4 million that were brought in in the first term of this government. The government talks about a narrative here on intergenerational fairness.

Where's the intergenerational fairness in that? Can I point out that debt is heading to $1.25 trillion. The interest bill on that is $80,000 a minute.

To put that in the context of a household, can you imagine what Australia could be purchasing right now and what we could be investing in if we were saving on that interest bill? When the government's spending so much money—it's such an absolute state in the budget with running up so much debt and so much poor investment over that period of time—is there any wonder why they're having to increase taxes?

When they run out of taxpayers' money, they need to get more of it, and that's exactly what these bills are entirely about. It's not about intergenerational fairness. It's about trying to fill the coffers of the government—very disappointing—at the cost of small businesses at the cost of those who are trying to do the right thing through a testamentary trust to try to ensure that the next generation are looked after.

These measures that are part of the budget are an absolute attack on aspiration, and the coalition will not be supporting them.