Treasury Laws Amendment (Tax Reform No. 1) Bill 2026, Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026
Senator BARBARA POCOCK (South Australia) (18:00): I rise to speak to the Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 and the Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026. These bills are a very small step in the right direction. They could have been so much better, but they are a step heading the right way.
Today, the Greens have secured changes to these bills to make it harder for wealthy property investors to outbid renters. While the Greens confirm we will support these tax changes to pass the Senate this fortnight, the fight does not stop there. There's so much more that this Labor government must do to fix this housing crisis that is only growing more urgent by the day.
For over 26 years, the Australian Greens have been pushing hard to get rid of the extraordinary property investor tax perks that have priced so many people—so many people—out of owning their own home. When the bill to implement the CGT discount changes was debated in this Senate in 1999, former Greens leader Bob Brown made it clear that this change would turbocharge economic and housing inequality in Australia.
He said these changes would give advantages to the rich and take from the poor. Well, he was spot on. He was right.
The CGT discount, all these years later, is the most egregious and unfair tax break on the books. The Treasury calculated that 54 per cent of the lost revenue from CGT discount in 2022-23—that's $12.7 billion—went to the richest one per cent of taxpayers. It is a reverse Robin Hood tax: it takes from the bottom end and gives to the very, very wealthy.
The Greens' persistent and long-term advocacy—which culminated in the recent Senate select committee into the operation of the capital gains discount, led by my colleague Senator McKim—has been a significant factor in this legislation being introduced into this parliament. The CGT discount is responsible for driving a chasm between generations in Australia. Former Treasury secretary Ken Henry called this intergenerational injustice built into our tax system an intentional 'act of bastardry'.
He's so right. People under 35 get only four per cent of the benefit, and they have to stand up at auctions with those getting the benefit alongside them, outbidding them, year after year. What is unfair to young people is entire generations being priced out of housing.
The Greens have managed to win some important amendments to these bills. We've won an amendment to close self-managed superannuation funds' exemptions from the prohibition on being able to borrow to fund investments. This is a recommendation that's been consistently made by financial stability reviews.
It's long overdue. We've also won an amendment to remove the Treasurer's ability to add any additional classes of assets that become eligible for the 50 per cent tax discount, and to rein in his power to prescribe any type of property investment that can be eligible for deducting losses against salary and wage income. This prevents a minister undoing these changes at the stroke of a pen by extending the discount to other assets.
These powers were unworkable and unprecedented, and they needed to be reined in. These are important changes and I want to commend my colleague Senator McKim for winning them. They're important, they're significant, and they were hardfought.
This was a once-in-a-generation moment to help Australians. Unfortunately, Labor has missed a critical opportunity here. Labor's decision to lock in $33 billion in tax handouts for those with two or more investment properties means that 1.7 million properties will remain in the hands of wealthy property investors, not first home buyers, and they'll leave renters to continue fighting the housing crisis for longer.
The Parliamentary Budget Office analysis, based on ATO data in 2023-24, reveals people with two or more investment properties claimed an eye-watering $33 billion in tax handouts that year. That is what Labor is baking in. That is what we would have had available to us to spend on public housing to address the housing crisis.
That includes 11,000 landlords with seven or more houses who claimed $1.9 billion from 98,100 investment properties—incredible. It's intergenerational highway robbery. After four years in government and multiple failures to act, Australia's housing crisis is now Labor's housing crisis.
It is now on Labor that we continue in a crisis that has become worse through their policy failures. The housing crisis confronting Australia today is not an accident; it's the predictable result of decades of bad government. It's the result of governments treating housing primarily as an investment asset rather than a human need.
It's the result of tax concessions that have overwhelmingly benefited those with the greatest capacity to accumulate wealth, and boy has it rewarded them. It's the result of a sustained failure by governments across this country to invest in public and social housing, which so many Australians are so desperately waiting on lists for decades to get into. The evidence of the housing crisis is overwhelming.
According to the Labor government's own housing affordability council, Australia is currently experiencing record low affordability on rents, record low home purchase affordability and record high rental stress. We've got vacancy rates that are at historic lows. Homeownership rates among younger Australians have fallen year after year.
Rents have surged. Public housing waiting lists have grown. This is all while the current Labor government has overseen the lowest average rate of public housing construction of any postwar federal government.
Shame! Shame on a government that should see housing as a central plank of a decent life. Homelessness has increased, and the Treasurer himself has acknowledged that house prices in Australia have risen by an incredible 400 per cent since 1999, when these tax breaks were first introduced.
This is more than twice as fast as average incomes. Rents have done the same. They have increased at two and a half times the rate of wage increase.
The Senate Select Committee on Intergenerational Housing Inequity, which I'm chairing at present, has heard a great deal of very devastating evidence from around our country and from all sectors of the community about the housing crisis and how it is affecting people in country towns, in our regional centres, in our cities and in our suburbs. Last week we heard evidence from one witness, Elise, who has been on the public housing waiting list in South Australia for more than two decades.
Her latest rent increase means she is now paying 60 per cent of her income on rent. How does the government expect people to live like this? Last week we also heard from an incredible 13-year-old, Sebastian, whose dream of owning a home one day feels impossible if house prices continue to rise like they are.
He's collected 22,000 signatures from his peers and others—about the crisis his generation faces. He spoke of the despair and hopelessness amongst his peers. In the City of Onkaparinga, South Australia, which is our largest local government area, house prices have increased by 80 per cent in the last five years.
We've got homelessness in our outer suburbs in Adelaide, South Australia, like we have never seen before, and that's just the people we can see. We know there are many women, many of whom have children, who are in cars and on couches and are invisible to us in this crisis. The Greens were very disappointed on budget night by the lack of ambition in Labor's budget.
There was nothing in their budget for the 31 per cent of Australians who are renters. There was nothing in that budget for people experiencing homelessness, which is increasing so quickly in so many parts of our country. These bills are a small step in the right direction, but Labor's low ambition means that inequality and the housing crisis will be worse for longer than it needs to be.
This government could've done so much more. It could've collected $33 billion in tax and put it into public housing, which would've made such a difference, to play catch-up on the failure to invest in the recent years of the Labor government and in the decades leading up to it. This enduring housing crisis is now squarely on Labor.
Labor has fuelled demand with its five per cent deposit scheme and has pushed housing prices up, and it's an uncapped scheme available to all. It has done the wrong thing and made the crisis worse in so many parts of its policy, and most importantly it has failed to address the scale of the crisis which is so obvious across our country. The HAFF has built just over a thousand homes.
It is an absolutely inadequate response to the crisis for our young people and so many people who are living in housing insecurity. This moment requires so much more from Labor. Unfortunately, their ambition is pathetic.
It is not adequate, it is so unlike the response our country needs, and it is a betrayal of those who are living on our streets, in cars and insecurely. We Greens will not stop fighting for renters—the one-third of our country who rent—we will not stop fighting for young people or for first home buyers, and we will not stop fighting for all Australians to be able to put a roof over their head.
It's a central pillar of a human rights regime for a decent life for Australians—access to free education, to health care and to a roof over your head. We know what we need to do, and we can do it. We've done it before, and we have the budget available to us if we tax people right, if we tax gas and if we end absurd spending on AUKUS.
We have the resources, as a wealthy country, to put a roof over everyone's head, so we urgently need to remove investor incentives, to build more public housing directly, to cap rents and adequately fund homelessness services. The Greens have consistently argued that reforming tax concessions must be linked to a significant increase in public investment in housing.
Just as governments invest in roads, in hospitals, in schools, in public transport and in infrastructure, governments must invest directly in housing. That means public housing, that means community housing, and it means genuinely affordable housing. It means rejecting the failed idea that private markets and a private housing market can solve this crisis.
It has made it worse, and tax reform is necessary. It needs to be meaningful. It needs to be ambitious.
Tax reform on its own is far from enough. Even those who support changes to negative gearing and capital gains tax arrangements acknowledge the broader structural solutions are essential. Australia still needs a massive program of social public housing construction, and we need stronger protections for renters.
We need greater investment in homelessness services, and we need to continue examining the tax settings that contribute to the widening housing inequality in our country. We believe housing is a human right, we believe public housing is essential infrastructure, we believe tax policy should reduce inequality rather than deepen it, and we believe that every Australian deserves the security and the dignity that comes with owning their own home.