EDITORIAL: Budget fix must hear hard-working mums and dads
A warning light is flashing in middle Australia where mum and dad teams and young small business owners have slogged it out to get a start.
Ten days on from the Budget there is little sign the anger directed towards the Albanese Government will end any time soon.
If anything the noise about the need for changes seems to have grown louder as the days have gone by.
The intervention by NSW Labor Premier Chris Minns — who declared families were being “stung” as pay rises pushed workers into higher tax brackets and demanded more action to combat bracket creep — opened the gate.
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By continuing you agree to our Terms and Privacy Policy.That in itself wasn’t enough to knock Prime Minister Anthony Albanese or Treasurer Jim Chalmers off their lines.
On Thursday Mr Albanese fended off criticism centred on changes to the capital gains tax discount, negative gearing and trusts — including fiercely rejected claims of a new “death tax” — saying the Government had “the ticker” to take up the challenge.
And Dr Chalmers said Labor had “anticipated” a backlash. “We anticipated our political opponents engaging in the usual scare campaigns built on lies,” he said.
But a serious crack in the Federal sell emerged when senior Labor MP Andrew Charlton acknowledged the concerns were valid.
Dr Charlton, the Cabinet Secretary and Assistant Minister for Science, Technology and the Digital Economy, is highly-credentialled.
He studied at the University of Sydney and Oxford University, where he was a Rhodes Scholar, and graduated with a PhD in economics.
As senior economic adviser to former prime minister Kevin Rudd, Dr Charlton helped navigate Australia through the 2007-2008 Global Financial Crisis.
He later built consultancy AlphaBeta, which was bought by global IT consulting company Accenture.
Much of the anger surrounds capital gains tax.
The 50 per cent discount will be replaced with an inflation-index model and paired with a 30 per cent minimum tax rate on net capital gains — extending beyond property to all investments.
On Friday Dr Charlton conceded it “doesn’t interact well” with small businesses that have a low capital base.
“The point that many startup founders . . . many small businesses have been making is valid,” he said. “Because that new regime doesn’t interact well if you have a really low capital base because you’ve got nothing to inflate off.”
Mr Albanese signalled an apparent willingness to give some ground on trusts, declaring “there’ll be a consultation period about that, and we made that clear on Budget night”.
And while tech sector concerns have been at the forefront, a warning light is flashing in middle Australia where mum and dad teams and young small business owners have slogged it out to get a start.
It was summed up in an open letter from female founders of beauty and wellness, arts, fashion, public relations, and retail businesses, who “had an idea, took a risk, and worked incredibly hard to build businesses — often while raising families at the same time”.
The capital gains tax plan would make it even harder. Here the pain is acutely felt.
