EDITORIAL: Federal Budget push has put arrogance on display
The Albanese Government has made clear in its determination to push on with the deeply flawed Budget that it has reached this point.
To be a political leader requires a healthy dose of self belief.
But you also need the ability to see when it is time to pause, rethink and redirect.
Failure to recognise this need is a sign you have slipped from healthy self-belief into arrogance — I know I’m right, all the others are wrong.
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By continuing you agree to our Terms and Privacy Policy.The Albanese Government has made clear in its determination to push on with the deeply flawed Budget that it has reached this point.
On Thursday Treasurer Jim Chalmers introduced a Bill into Parliament which includes changing negative gearing and capital gains tax settings.
The 50 per cent discount on capital gains tax will be replaced with an inflation-based discount, with a 30 per cent minimum payable on the taxable portion.
Negative gearing of investment properties will be limited to newly-built homes.
The capital gains tax changes have proven the most controversial because they cover all asset classes, not just housing — which was the key message sold around “intergenerational equity” before the Budget.
Business Council of Australia boss Bran Black said the Budget would make the tax system even less competitive at a time Australia needed to attract global capital.
Australian Chamber of Commerce and Industry boss Andrew McKellar said the Government should pull back the capital gains tax change to housing alone.
Commonwealth Bank chief executive Matt Comyn said applying the change across the board risked curtailing innovation.
Ai Group chief executive Innes Willox warned the changes were “fatally flawed and amount to economic self-harm”.
On Thursday Dr Chalmers was unrepentant, arguing that the plan to split the various tax changes across multiple pieces of legislation with “specific implementation details” still to come after further consultation — akin to shooting first and asking questions later — was standard tax reform procedure.
He accused opponents of “dishonest scare campaigns and deliberate distortions of the truth” and said the Government was proud to introduce the legislation.
He might want to call WA Premier Roger Cook, who is now the third senior Labor figure to raise concern.
Mr Cook followed NSW Premier Chris Minns, who said workers were being over-taxed due to bracket creep, and Federal Assistant Minister for Science, Technology and the Digital Economy, Andrew Charlton, who said the new model “doesn’t interact well” with small businesses that have a low capital base.
Mr Cook echoed industry concerns that the changes could deter investment in WA’s crucial mining industry.
“We want to make sure that it doesn’t disincentivise both international investment in our major projects, but also exploration by our small miners,” he said. “It’s been raised with me by investors, both domestic and foreign”.
At the heart of all this sits a key fact. Changes to capital gains tax and negative gearing were ruled out by the Prime Minister before the last election.
Broken promises. Lost trust. Shredded credibility. Nothing there for the Government to be proud of.
