Portfolio — 29 May 2026

Treasurer Jim Chalmers used 29 May to convert the tax package he pre-announced in question time on 27 May into live legislation, moving both the Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 and the Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026 to a second reading in the House [TA-260528-house-f5e69c44cc32:s007] [TA-260528-house-f5e69c44cc32:s008].

He framed the two-bill structure as the first step in what he called the most ambitious tax-reform package in a quarter of a century, targeting three simultaneous objectives: cutting taxes for every Australian worker, easing the path to first-home ownership, and realigning the tax treatment of labour income with asset income [TA-260528-house-f5e69c44cc32:s007].

The Treasury Laws Amendment Bill carries four operative measures. A permanent $250 Working Australians Tax Offset will apply to more than 13 million workers from the 2027–28 financial year, explicitly targeting nurses, teachers, tradies and truckies [TA-260528-house-f5e69c44cc32:s007]. A $1,000 instant tax deduction will benefit around 6.2 million people, delivering an average $205 cash back at tax time and operating alongside existing work-related deductions.

Combined with legislated tax cuts already in train, the average worker is projected to receive up to $2,816 in total benefit by 2028 [TA-260528-house-f5e69c44cc32:s007]. On housing, negative gearing will be restricted to new residential builds from 1 July 2027, a change the government projects will produce around 75,000 additional homeowners over the next decade.

Capital gains tax is restructured from the same date: the 50 per cent discount is replaced by cost-base indexation with a 30 per cent minimum tax, though gains accrued before that date retain the existing discount. Exemptions for age-pension and JobSeeker recipients are built in, and small-business CGT concessions along with the 50 per cent discount for affordable housing are retained [TA-260528-house-f5e69c44cc32:s007].

In debate, Chalmers drew a sharp political line, telling the House that a vote against the measures would raise taxes for workers and leave the housing market in what he described as a broken state [TA-260528-house-f5e69c44cc32:s135]. He accused opposition members of running scare campaigns and of seeking an early election rather than engaging with the substance of the reforms.

The parliamentary record does not contain a detailed opposition rebuttal in the segments available for this window; that gap should be noted when assessing the completeness of the debate picture.

The two second-reading motions mark a meaningful legislative acceleration: the package moved from a question-time pre-announcement on 27 May to formal second-reading stage within two sitting days. The negative-gearing and CGT changes cross into housing-portfolio terrain, and the retention of specific affordable-housing concessions signals deliberate boundary-setting between the two portfolio domains.

Policy staff tracking the housing-affordability agenda should note that the 75,000-homeowner projection and the new-builds carve-out for negative gearing are now legislative claims, not merely announced commitments.