Here’s a tip: If you don’t want to be compared with Pinocchio, don’t break promises and don’t tell lies. Digital mischief: Region/Gemini.
Budgets are more than a financial blueprint for the country. They are a test of character for our leaders and a Rorschach test for us.
Usually, our assessments see us fall into our tribes: Labor supporters will cheer a Labor budget; Liberal supporters will cheer a Liberal budget.
For Liberal voters, the toughest test was the Abbott-Hockey 2014 budget.
For Labor voters, the toughest test is the Albanese-Chalmers 2026 budget.
Albanese and Chalmers can try to sell this budget as responsible (when has a Treasurer ever said their budget isn’t?) and not political (when do they ever say it is?), but they are simply not telling the truth.
To be frank, Albanese and Chalmers have lied their arses off about this budget and continue to do so every time they deny it.
The pair of them often and vehemently said they would not change capital gains tax and negative gearing rules. And they went to an election saying that. And then they changed the rules when they’d trousered the votes.
You’ve probably seen the clips, gleefully shared by the Opposition.
Will it matter, though? Because this government also said they would enact the Stage 3 tax cuts and then changed their mind, blaming the “aftershocks” of COVID, “greater global uncertainty”, phases of the moon, whatever, and they got away with it.
The same goes for their super changes. Promises made; promises broken.
But this is different.
The Stage 3 tax cuts involved not giving money to a small group of ‘rich’ people through tax cuts and instead giving tax cuts to a lot of people. That’s not a hard sell.
They got away with it because we accepted the bribe. And the bribe, in that instance, was paid with other people’s money (rich people). This was the template forged with the super tax changes in February 2023 (“We’ve said we have no intention of making any changes to superannuation,” Albanese said during the 2022 campaign — sound familiar?)
The lesson for Albanese and Chalmers was that they could lie (‘change their minds’, if that’s how you see the ink blots) so long as the number of winners was greater than the number of losers.
“Politics is governed by the iron laws of arithmetic,” as John Howard noted.
And it’s a good thing Howard has now entered the chat.
Howard famously said he would “never, ever” introduce a GST.
That was like a wedding vow, where you look at your beloved and “forsake all others”.
Two years later, though, Howard wanted to rewrite the vows so he could have a sneaky side trip to Vegas with da boyz, so he rewrote them by going to an election.
That’s what Albanese should have done if he was going to do such an about-face.
That would be the right thing to do. So why didn’t he? Because those vows were taken to an election in 2019 by Bill Shorten, and the beloved said, “You wanna do what in Vegas?”
Shorten’s policies were election poison.
How poisonous?
So poisonous that we looked at Labor, looked at their policies, looked at Bill Shorten and decided to run off for a dirty weekend with Scott Morrison instead.
The question now is, will Albanese and Chalmers get away with it in 2026?
Probably not. Partly because they are relying on Treasury modelling and, well, Treasury ain’t what it used to be. And it’s bad policy from soup to nuts.
If the changes to negative gearing and CGT for housing (note that caveat – for housing) were designed to raise revenue, they are sadly mistaken.
People will avoid the new CGT rules by not selling. And people taking advantage of negative gearing will continue to do so through grandfathering provisions.
(Interestingly, the ACTU proposed that CGT and negative gearing be phased out over five years, a much more punitive policy but one that would have actually raised revenue, and cost less over the forward estimates, and seen more homes put onto the market by people selling so they wouldn’t be stuck with rental losses they’d have to pay for and higher CGT.)
And in case you thought this would make it easier for first-home buyers, consider this: the old CGT and negative-gearing rules still apply, but only to new builds. That means every new apartment is a tax shelter, so first-home buyers will be competing with a more concentrated group of cashed-up buyers.
Well done, Treasurer.
But as people delve deeper into the budget papers, they’re finding even more devil in the detail. That’d be the caveat mentioned earlier.
Did you know that the new CGT changes will raise revenue by lifting capital gains tax on all asset classes? Say what?!? Yeah. There’s no escape.
If you thought you could avoid higher CGT by putting your money in shares and not real estate (or save for your home deposit through investments — a hit on Millennials), you’re about to get whacked with a higher tax!
Lots of people will feel that. And it wasn’t in the brochure last election.
And if the changes to CGT and negative gearing were designed to hit boomers to create “intergenerational equity”, that’s another fail. They’ll avoid all the changes.
Boomers were technically born between 1946 and 1964. They’re old. They’re not about to sell. They need a secure, stable income. That’s real estate. And there’s no negative gearing in God’s waiting room because most people aged in their 60s to 80 aren’t wage slaves, so they’re not offsetting income.
But time is doing what time does, and when they die, their heirs will inherit their assets, which can be sold tax-free … unless there are “aftershocks” of COVID, “greater global uncertainty”, phases of the moon, whatever, and a death tax is introduced … but we know Albanese has ruled that out, right, so it won’t happen.
And that’s the real problem the Albanese Government faces: what are their promises worth?
Only a damn fool would trust a single word that comes out of his facehole. And the same goes for his heir, Jim Chalmers — and, frankly, anyone else who defends these decisions as ‘not broken promises’. They are.
Albanese and Chalmers have proven that not only are they liars who are prepared to lie whenever it suits them, but they will then look you in the face and say they aren’t lying (the sign of a real pro) and become indignant that you impugned their honour.
You may not agree. That’s fine. It’s a Rorschach test. Just don’t be shocked when they do it again. They have form.
Original Article published by David Murtagh on Region Canberra.
