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

Senator WALKER (South Australia) (19:48): I rise today in support of the Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 and the Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026. I want to start with a pretty simple observation. For years, Australians have been told that housing affordability is too hard, too complicated, too politically sensitive and too difficult to tackle.

Every government acknowledged that there was a problem, every politician gave speeches about it and every expert wrote reports about it. Yet, for young Australians, the dream of homeownership kept drifting further away. House prices climbed, deposits grew larger, rents increased and more and more people found themselves wondering whether they would ever be able to buy a home of their own.

This government has decided that simply talking about the problem is no longer enough. We are prepared to act, because housing is not just another economic issue. It is one of the defining issues facing this generation of Australians.

It affects whether people can move out of home, whether they can start a family, whether they can build financial security and whether they can put down roots in the communities they love. If we're serious about making housing more affordable, we have to be willing to have serious conversations about the policies that shape our housing market. That is exactly what this legislation does.

There has been a lot of chirping about this bill—a lot of outrage, scare campaigns and social media posts claiming this is the end of civilisation as we know it. But, when you strip away all the noise, this package does three very simple things: it cuts taxes for workers, it makes tax time easier and it helps more Australians buy their first home. That is what this legislation is about.

This is a tax package that is pro-worker, pro-aspiration and pro-investment. It delivers tax investment for more than 13 million Australian workers. It introduces the working Australians tax offset, providing a permanent annual tax offset of up to $250 for working Australians.

This isn't a temporary measure or a one-off payment but a permanent tax cut. It introduces a $1,000 instant tax deduction so Australians can claim up to $1,000 in work related deductions without having to spend hours collecting receipts and navigating complicated paperwork. Let's be real: nobody enjoys tax time.

Nobody wakes up excited about searching through old emails trying to find receipts from eight months ago. Nobody wants to spend their weekend trying to remember whether they bought something in September or October. Australians want a tax system that works for them—a tax system that is simpler, easier and fairer.

These reforms will reduce compliance costs by around $540 million every year. That's less paperwork, less frustration, less time dealing with bureaucracy and more time focusing on work, family and everyday life. Combined with the tax cuts already announced by this government, the average working Australian will be up to $2,800 better off each year by 2028.

This is real cost-of-living relief. At a time when Australians are doing it tough, what some people have called 'small' measures really matter. But this legislation is also about something bigger.

It's about intergenerational fairness. It's about recognising that young Australians deserve the same opportunities previous generations enjoyed. If you're in your 20s or your 30s today, the housing market looks very different to the one your parents entered.

Young Australians have done everything they've been told to do. They've worked hard, studied and built careers. They've saved up as much as they can.

Many have moved back home with their parents to save for a deposit. Many have delayed major life decisions because housing costs have become so overwhelming. Yet, every weekend, when they turn up to inspections and auctions, they're competing not only with other first home buyers but often with investors who already own property.

This doesn't feel fair, and this government isn't afraid to say that. The reality is that housing policy cannot only work for the people who already own assets. It must also work for people trying to build a future.

That's why these reforms are so important. Treasury estimates these changes will help around 75,000 Australians achieve homeownership. That's 75,000 people who will have a better chance of buying their first home and 75,000 people who will have a better chance of building security for themselves and their families.

This is a significant outcome, and it's one that should be welcomed by everyone in this chamber. But what have we seen from the opposition? The Liberals, the Nationals and One Nation have lined up to oppose these reforms.

They are blocking tax cuts for working Australians, they are blocking measures to make tax time easier and they are blocking reforms that will help more young Australians buy a home. They offer outrage and they offer scare campaigns but they don't offer solutions. Let's talk specifically about negative gearing.

If you listened to some of the commentary surrounding this debate, you would think that this government was abolishing negative gearing altogether. We aren't. Australians will still be able to negatively gear residential property.

The difference is that, from 1 July 2027, those arrangements will be focused on new housing supply. If people want to use negative gearing, they can still do it by investing in new homes—homes that increase supply, homes that help address Australia's housing shortage, homes that contribute to the construction of the housing stock our country desperately needs.

That seems like common sense to me. Importantly, existing investments are completely protected. If somebody already owns an investment property, nothing changes.

Their arrangements remain exactly the same. This reform is targeted, sensible and measured. Despite all of the noise, the overwhelming majority of Australians will never be affected.

Only around one per cent of tax filers begin negatively gearing a property in any given year—one per cent. Yet, somehow, we are expected to believe that modest reforms affecting a small proportion of taxpayers represent some kind of national emergency. The facts simply do not support that argument.

The same applies to our capital gains tax reforms. The current system provides a flat 50 per cent discount regardless of inflation. This government is replacing that arrangement with a fairer approach that focuses on real actual gains not inflationary gains.

Once again, there has been a lot of misinformation about these changes. Treasury estimates that, under these reforms, the average tax rate on gross capital gains will increase from 19.3 per cent to 21.4 per cent over the medium term—not 47 per cent and not the figures being thrown around in memes but a modest increase that creates a fairer system. Who benefits most from capital gains?

Treasury's analysis shows that more than half of all capital gains are realised by the highest lifetime income earners. Meanwhile, ordinary Australians pay tax on every cheque they earn. Workers cannot negotiate a 50 per cent discount on their wages.

Teachers cannot claim a 50 per cent discount on their salary. Nurses cannot claim a 50 per cent discount on their income. Tradespeople cannot claim a 50 per cent discount on their pay packet.

So it is entirely reasonable to ask whether the tax system should better balance the interests of workers and investors. That is what these reforms seek to achieve. They reduce distortions that have encouraged investments in established housing.

They encourage investment in new housing supply. They help fund tax relief for more than 13 million Australian workers, which is a fair trade-off. This debate ultimately comes down to a simple question: who are we building Australia's future for?

Are we building it for those who already have the most assets, or are we building it for the next generation of Australians who are trying to get ahead? This government has made its choice. We are backing workers.

We are backing aspiration. We are backing homeownership, and we are backing young Australians, because every generation deserves the opportunity to own a home, every generation deserves the opportunity to build wealth through their own hard work, and every generation deserves a government willing to take difficult decisions in the national interest. This legislation delivers tax relief for workers.

It makes tax time simpler. It supports homeownership, and it helps create a fairer Australia. For those reasons, I proudly support this bill and commend it to the Senate.