Australian news and politics live: Albanese’s tax change plans to tackle 400 per cent rise revealed

Contentious tax changes that have dented housing market activity could slow Australia’s economy and deter the Reserve Bank from hiking interest rates again.

Fresh data is likely to show gross domestic product was still growing at a fairly rapid clip at the start of the year, but a slowdown is on the way.

Wednesday’s national accounts release is likely to be the last time annual growth has a two in front of it for some time, which could convince the central bank to hold off on more rate rises.

Economists at National Australia Bank expect the Australian Bureau of Statistics to show the economy grew by 0.3 in the March quarter, which would put the annual growth rate at 2.4 per cent.

In May, the Reserve Bank predicted GDP to rise by 2.6 per cent.

NAB’s forecast downgrade is largely the result of a sharp rise in imports, which resulted in Australia’s first trade deficit since December 2017.

Imports surged on the back of higher fuel prices and the AI boom, NAB chief economist Sally Auld said.

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The Coalition has drawn a line in the sand over Labor’s housing reforms, offering to back tax cuts while vowing to oppose what it has branded “toxic taxes” amid growing political backlash to the Federal Budget.

Appearing on Sunrise on Wednesday, Coalition Senate leader Michaelia Cash said the Opposition would seek to split Labor’s legislation, allowing Parliament to pass tax offsets while rejecting changes to negative gearing and capital gains tax concessions.

“We will actually help Labor help themselves,” Ms Cash said.

“We can all vote for the tax offset and the business expense offset, and then we can all vote no to Labor’s toxic taxes.”

The comments came as Housing Minister Clare O’Neil was forced to defend the government’s reforms and pushed back on claims they were creating uncertainty in the housing market.

Ms Cash accused Labor of misleading voters before the election and argued the reforms had undermined confidence among homeowners, investors and builders.

“You can’t lie to the Australian people, Clare, and then not take responsibility for what’s now happening in the housing market,” she said.

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Australia’s new defence secretary has claimed buying only second-hand submarines from the United States was always the preference for AUKUS, before later clarifying to a Senate committee that the project could have “two constrained optimal pathways”.

During her first public appearance since taking over the high-powered role, Meghan Quinn was grilled by senators about recently announced changes to the $368 billion project to acquire a nuclear-powered fleet to replace the ageing Collins-class boats.

Over the weekend, the defence minister confirmed Australia would now receive three “in service” Virginia-class submarines from the US, instead of one new and two second-hand boats, arguing the move would improve simplicity and be significantly cheaper.

Under questioning from shadow defence minister James Paterson at a Senate Estimates hearing on Tuesday night, the newly appointed defence boss initially gave evidence that the recently adjusted approach to AUKUS had always been Australia’s preferred plan.

The Secretary was asked which country had made the decision that only “in service” boats would now be purchased from the United States, instead of Australia receiving one new submarine and two “in-service” boats.

“Australia’s position is that we would always have a preference for three in-service (submarines),” Ms Quinn responded.

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