Tax takeaways from Chalmers’ pre-budget interview blitz

"I know there’s been a bit of speculation, all of it wrong," Albanese said in response to a journalist's query about reported changes to negative gearing and the CGT discount.

"When people see what we’re actually going to do in the budget, people will be able to make their own assessments, but I can assure you that it is aimed firmly and squarely at aspiration."

In a slew of media appearances last Thursday (30 April), Chalmers emphasised that any tax changes would focus on curbing intergenerational inequality, without confirming any policy details.

“Without signing up to a particular model or to any part of this speculation … we’ve made it really clear for some time now that we think that there are intergenerational issues in the tax system and in the housing market,” Chalmers told Commonwealth Bank chief economist Luke Yeaman on the CommBank View: Economics and Markets podcast.

“There is a welcome debate out there about the role of tax reform in trying to rebalance this issue we’ve got between very generous treatment of assets and less generous treatment of labour income of workers.”

When Yeaman asked about the government’s approach to grandfathering, Chalmers neither confirmed nor denied how policymakers would approach transitional arrangements for taxpayers.

“Without getting into hypotheticals about policies, what you try to do is to make sure that we recognise the decisions that people have taken in the past,” he said.

“Whenever anyone is thinking about these sorts of issues, some of these big tax reforms that have been speculated about, obviously people work through or think through some of those transitional matters.”

During an interview on Channel 7’s Sunrise program, co-host Natalie Barr asked Chalmers whether changes to negative gearing and the CGT discount were simply a “cash grab,” given that economists predicted it wouldn’t reduce house prices but would add $30 billion to the budget.

“In principle, some of the changes that you’re talking about, some of the changes that people have been reading about, would raise nowhere near the sorts of dollars that you just referenced in your question,” he responded.

Speaking to Yeaman, Chalmers noted that the government’s main mechanism to improve housing affordability was through supply-side measures, but CGT changes could affect the composition of the ownership base.

“I think anyone who looks objectively at the way that home ownership rates have declined over time and proportionately as well, homeowners and owner‑occupiers versus investors, there’s been a long‑term trend,” he said.

“I think that even if you just go back to around the turn of the century, those changes that were made to capital gains, you can see that that’s had an impact in the composition of the housing market.”

When asked by ABC News Breakfast’s Emma Rebellato about the prospect of a 25 per cent gas export tax, Chalmers backed up Prime Minister Anthony Albanese’s comments, shutting the conversation down last Wednesday (29 April).

“There are … really good reasons to prioritise these international supply arrangements, particularly during this oil shock,” he said.

“All of us have been prioritising getting fuel for Australia and for Australians to keep the economy ticking over, and that’s why there are good reasons for the comments that the Prime Minister made yesterday.”

Speaking to the Chamber of Minerals and Energy of Western Australia, Albanese said the government would not implement policies to alter existing gas export contracts.

“Our gas exports are directly linked to our national fuel security. And the middle of a global fuel crisis is the worst possible time to jeopardise these partnerships, or the investment that underpins them,” he said.

“This is why I can confirm that the Budget will not undermine existing contracts on gas exports.”