Inside the making of tax law and how you can make a difference

Now the Treasury Laws Amendment (Tax Reform No. 3) Bill 2026, which introduces the minimum tax on discretionary trusts (minimum tax) and contains the second tranche of the CGT and negative gearing reforms, is before the Senate Economics Legislation Committee (Senate Committee), which is due to report on 13 November.

Understanding the machinery is not an academic exercise. The stages at which practitioners can genuinely influence the outcome close much earlier than many people assume, and the stages that follow royal assent determine how the law will be administered by the ATO.

Stage 1: Budget night and the 7:30pm problem

An announcement is not law. But in tax, the start date frequently is the announcement. For several 2026 budget measures, the grandfathering and integrity rules are tied to 7:30pm (ACT time) on 12 May 2026, the moment the Treasurer rose to deliver the budget speech. From that moment, clients were transacting under one set of rules while knowing that another set would later be applied to them.

This is the gap in which practitioners are routinely asked to advise, and it is uncomfortable territory. The ATO’s published approach to unenacted retrospective legislation (legislation that, once enacted, applies from a date before enactment) is that it will not advise taxpayers to self-assess on the basis that an announced change will become law. If taxpayers choose to do so, it will not apply resources to checking those self-assessments against the existing law. Where taxpayers instead self-assess under the existing law and the law is later changed retrospectively, they will need to seek an amendment and pay any increased liability once the law is enacted. No shortfall penalties will apply, and interest will be remitted up to the date of enactment. Interest after that date is remitted only if the taxpayer seeks the amendment within a reasonable time.

Announced but unenacted measures (ABUMs) accumulate across governments of both persuasions. In 2013, an incoming government inherited a backlog of 92 such measures and abandoned most of them. Targeted amendments to Division 7A, announced in the federal budget 2016–17 and the subject of a Treasury consultation paper in 2018, have never been legislated. Taxpayers are entitled to certainty, and a measure that sits on the books for years without legislation provides none. The unlegislated measures tracker published by the Parliamentary Budget Office is a useful resource for checking the status of ABUMs, but it was last updated in August 2025.

What practitioners can do

Treat advice given in the gap as advice on a moving target. File-note what was announced, the date of your advice, and the assumption on which it rests. Tell clients in writing that the law may change, and that the change may apply from a date that has already passed.

Stage 2: Consultation and exposure drafts, where real influence lies

Major measures typically pass through two rounds of public consultation:

• A consultation paper asks policy design questions such as who should be in, who should be out, and what transitional relief is needed; and
• Exposure draft legislation then asks whether the words on the page achieve the policy.

Consultation is the stage at which practitioner input is most effective, for a simple reason: nothing has yet been committed to Parliament.

Fixing a drafting flaw in an exposure draft costs Treasury a redraft. Fixing the same flaw once a bill has been introduced requires government amendments, parliamentary time and, often, political capital. The minimum tax demonstrates the point. The bill as introduced on 14 October contains changes that were not in the exposure draft, including refinements to the fixed trust definition and a new Commissioner’s discretion to preserve a trust’s excluded election trust (EET) status where automatic revocation of the election would be unreasonable. Consultation works best when it is given room to work.

That is the problem. Treasury released consultation on the minimum tax on 8 July, with submissions due by 31 July. Four exposure draft bills and their explanatory materials followed on 3 September, with comments due by 18 September.

Treasury’s own impact analysis puts the discretionary trust population at around 840,000, and estimates that some 320,000 of those trusts will need advice to restructure or elect out of the minimum tax. For a measure of that reach, 16 days is not meaningful consultation. It risks becoming a tick-box exercise, in which pre-determined outcomes confine feedback to minor details rather than core design issues.

This is not an isolated concern. The published key messages from the ATO’s National Tax Liaison Group (NTLG) meeting of 25 August 2026 record members’ concern that short consultation periods make meaningful engagement difficult and create doubt about whether feedback is being seriously considered. Treasury attends the NTLG, so it has heard this concern directly. The test now is whether consultation on the remaining tranches of the 2026 reforms gives the profession enough time to make a real difference.

How to make a submission count

Contrary to what many practitioners assume, submissions do not disappear into a void. Treasury officers and committee secretariats read every one of the dozens or hundreds of submissions they receive on a single consultation. However, some carry more weight than others. The most persuasive submissions:

• Lead with the problem and the fix, not with background the reader already knows;

• Include case studies or worked examples with real numbers showing the unintended outcome;

• Refer to specific provisions or paragraphs of the draft and explanatory materials;

• Propose constructive drafting or a clear alternative, rather than simply objecting; and

• Are concise and clearly structured.

You do not need to write a 40-page submission to contribute. A de-identified client scenario sent to your professional association can carry more weight than pages of principle. Real cases are what turn a general concern into a recommendation on which a committee or Treasury can act.

Stage 3: The bill and the Senate

Once a bill is introduced and read a second time, the government has committed to its design. In the House of Representatives, where the government holds a majority, bills pass largely as introduced. The Senate is where the real negotiation happens.

Tax bills are routinely referred to the Senate Committee, which invites submissions, may hold public hearings and tables a report with recommendations. The report does not bind anyone, but it shapes how the crossbench votes, and it creates the public record on which amendments are negotiated.

The CGT reforms show how this works in practice. To secure passage in June, the Government agreed to carve-outs and committed to dealing with further issues in a second tranche of legislation. Those commitments are now being delivered through the Treasury Laws Amendment (Tax Reform No. 3) Bill 2026. Undertakings given on the Senate floor become future legislation.

Practitioners should also understand the end-of-year rush. The final sitting weeks before the summer break are when the legislative logjam is cleared. Only two sitting weeks remain this year, with the final sitting day on 26 November. Debate may be cut short, government amendments may be circulated late, and a bill can pass in a form that differs materially from the one introduced. Government amendments are accompanied by a supplementary explanatory memorandum, but any amendments moved by non-government senators are not.

What to watch this month 

The Senate Committee’s report on the minimum tax bills is due on 13 November. Read the recommendations and any dissenting reports, then watch for government amendments. Whatever form the bill takes when it leaves the Senate is the form your clients will be living with from 1 July 2027 (for the CGT and negative gearing reforms, and the minimum tax roll-over) and 1 July 2028 (for the minimum tax more broadly).

Stage 4: Royal assent is not the end

A bill passed by both houses does not become law until it receives royal assent. The act then settles the words of the law, but not how it will apply. For practitioners, that is only the beginning of the work.

Delegated legislation

Not all the law is in the act. Regulations and other legislative instruments made under the act, known as delegated legislation, are made by the Minister and take effect from the date they are registered. Parliament never debates or votes to pass them. Either house can disallow an instrument, generally within 15 sitting days of it being tabled, but it operates as law in the meantime. Delegated legislation therefore receives far less parliamentary scrutiny than a bill.

This is directly relevant because the Treasury Laws Amendment (Tax Reform No. 3) Bill 2026 gives the Minister power to make instruments across seven substantive matters, including whether a trust is fixed and eligibility for the roll-over and the EET election, none of which has been released in draft.

Core aspects of the measures could therefore be set, and later altered, outside primary legislation. Practitioners rarely watch this stage, yet it can change outcomes as much as the bill itself.

ATO public advice and guidance

The explanatory memorandum becomes an aid to interpretation, and then the ATO’s guidance program begins. Not all that guidance carries the same weight.

Public rulings, including taxation rulings, taxation determinations and law companion rulings, bind the Commissioner of Taxation where they apply to you and you rely on them. Practical compliance guidelines are different: they explain how the ATO will allocate its compliance resources, and the ATO commits to administering the law in accordance with them. Decision impact statements and practice statements explain the ATO’s administrative approach. Neither is a ruling.

Commissioner of Taxation v Bendel [2026] HCA 18 is the cautionary tale. For more than 15 years, the ATO’s published view, most recently in TD 2022/11, was that an unpaid present entitlement (UPE) owed to a private company beneficiary is a loan for Division 7A purposes. Thousands of family groups restructured their affairs around that view, including by converting UPEs into complying loans. The High Court held that the ATO’s view was wrong. As a result of the court’s decision, TD 2022/11 is being reviewed, and the ATO’s decision impact statement sets out how the ATO will approach previous arrangements or assessments. Taxpayers who acted on the ATO’s view by entering into actual loans are left with those loans.

A ruling protects your client from the ATO taking a less favourable view. But it does not protect your client from the ATO being wrong, and it does not unwind the commercial steps your client took in reliance on it.

The volume of guidance that the 2026 reforms will require is also a pressure point. The NTLG’s published key messages record members highlighting the need for timely guidance on the CGT and trust changes.

Stage 5: Administration and the feedback loop

The final stage is the one practitioners live with every day: how the law is administered through ATO systems, services and compliance programs. It is also the stage at which the profession has a direct and continuing seat at the table, through the ATO’s consultative forums. The ATO is consulting on the form and substance of public advice and guidance on the Budget reforms but cannot provide advice on specific client matters until the measures become law.

ATO consultative forums

The ATO’s stewardship groups, and the network of associated working groups, bring the ATO together with nominated representatives of the professional associations, including the National Tax & Accountants’ Association (NTAA).

The NTLG, on which I represent NTAA, deals with technical tax law and its administration.

The Tax Practitioner Stewardship Group (TPSG), of which I am co-chair alongside an ATO co-chair, focuses on the practitioner experience of the ATO: systems, services, communication and the tax practitioner relationship.

These forums do not make tax policy; that is a matter for government and Parliament. What they do is help shape how the ATO administers the law: which guidance it prioritises, how its systems operate, how it communicates with taxpayers and practitioners, and where compliance efforts are directed.

Key messages from these meetings are published on the ATO website. Recent ones illustrate the range of issues:

• TPSG members highlighted the increasing pressures on the profession from Payday Super and the budget reforms, compounded by ongoing resource constraints;
• TPSG members raised concerns about the ATO’s approach to debt recovery, given the cash flow pressures facing small businesses and the need for sensitivity and empathy in debt-related decisions and recovery actions;
• At the NTLG, the ATO advised that red tape reduction will be proposed as a standing agenda item across stewardship groups, with the NTLG as the primary forum for prioritising ideas; and
• The ATO is developing a framework for measuring taxpayer compliance costs, and NTLG members identified FBT as an area of significant compliance burden.

Issues reach these forums because practitioners raise them with their professional associations. A specific example of a system failure, a misleading ATO letter or an unworkable process gives a forum member something concrete to put on the table. A general complaint that ‘the ATO is difficult to deal with’ does not.

Additional forums

The ATO’s forums are not the only avenue.

The Tax Ombudsman investigates individual complaints about the ATO and the Tax Practitioners Board, and its reviews of systemic issues can drive lasting change in how the law is administered.

The Board of Taxation advises government on the tax system, including through post-implementation reviews of enacted measures. These reviews are how problems with enacted law find their way back into policy, and they rely on the same evidence practitioners see every day.

How can you best navigate the reforms as a practitioner?

• Contribute to consultation. Even a one-page worked example matters. Send de-identified client scenarios to NTAA or your professional association while the consultation window is still open.
• Advise on the act as passed, not the bill as introduced. Check the Parliament’s bills pages for third-reading amendments and supplementary explanatory memoranda before finalising advice.
• Check the status of ATO guidance before relying on it: its type, whether it is draft or final, its date of effect, and whether it is withdrawn or under review.
• Read the published NTLG and TPSG key messages on the ATO website. They are the best public window into the administrative issues the ATO is working on.

Tax law is not something that simply happens to the profession. At every stage, from Budget night to the ATO’s guidance, there is an opportunity for practitioners to influence the outcome. The profession will be living with the 2026 reforms for decades. The window to shape them is open now, and it won’t stay open for long.

About the author

Robyn Jacobson is the senior advocate at the NTAA. She is a Fellow of NTAA, CA ANZ, and CPA Australia, and is a Chartered Tax Adviser of The Tax Institute.

About NTAA

NTAA is a prominent not-for-profit association, established in 1992 to support tax agents, accountants and tax advisers. For more than 30 years, NTAA has advocated on behalf of its members and supported them through its highly regarded tax seminars, products and hotline service. NTAA is a major representative voice for the tax community, representing more than 45,000 practitioners.

Read more at ntaa.com.au