Treasurer Jim Chalmers has dismissed outrage over his major tax overhaul as 'lies' and 'scare campaigns,' as Labor's polling numbers and property market indicators both took a hit on Monday.
In a stunning new poll, Labor fell three points behind One Nation, while auction clearance rates slumped and property prices declined, according to fresh reports released on Monday. Analysts largely blamed Mr. Chalmers' May 12 budget for the downturn.
At a press conference on Monday, the Treasurer stood by his contentious budget and claimed his landmark reforms had been undermined by a campaign of deceit. 'Obviously, there’s a big scare campaign playing out right now. There’s a lot of lies being told. Obviously there’s a whole heap of politics around this, but we’re focused on the outcome,' he said. 'We want to make sure that more people can get a toehold in the housing market.'
When asked if the dire polling had rattled him, Mr. Chalmers repeated his 'scare campaign' claim. 'We understand that these changes are contentious. We understand that there is a big scare campaign and a lot of lies being told about it; and so, in that context, it's not especially surprising to see the sorts of polls that we've seen overnight,' he said. 'For me personally, I would rather get the policy right and lose a bit of skin politically than to take the easy option and leave everything as it is.'
Business Leaders Voice Concerns
Mr. Chalmers' tweaks to the Capital Gains Tax discount and negative gearing overhaul have drawn widespread criticism from investors and businesspeople. Canva boss Cliff Obrecht, Atlassian co-founder Scott Farquhar, NextDC’s Craig Scroggie, and SafetyCulture’s Luke Anear have all voiced their opposition. 'Many founders will leave,' Mr. Anear said. 'I’m more worried about the ones who stay and the employees inside their companies. Not executives with share buybacks. The 30-year-olds who took a pay cut and bet on a future payout.'
Polling and Property Market Slump
A new poll from RedBridge Group and Accent Research showed Labor's favorability dropped since the release of last month’s budget. One Nation jumped four points to 31 percent, while Labor trailed on 28 percent and the Coalition languished on 20 percent. On a two-party-preferred basis, the current government retained a 55–45 lead over One Nation.
Cotality data released on Monday also showed auction clearances had declined to levels not seen since the Covid-19 pandemic. Property values in Sydney and Melbourne declined over the month of May. Analysts attributed some of the decline to higher interest rates and the budget changes weighing on consumer confidence. Azura Financial’s director Tom Hawley believed the market had not yet absorbed the impact of Labor’s housing reforms and that value losses were 'a bit worse than people think.'
Government Defends Reforms
Housing Minister Clare O’Neil rejected suggestions that the tax changes were the primary cause of falling prices, arguing that higher interest rates have played a larger role. Labor released costings showing capital gains tax and negative gearing reforms could raise $43.1 billion over nine years, while their tax on trusts would collect $44.2 billion over the same term.
The Coalition has vowed to walk back the budget’s headline policies and released several financial ideas of their own, including ditching super concessions and bolstering defence spending. They have also released a migration policy and indicated they would index progressive taxation measures to address bracket creep. Labor argues many of these proposed measures would prove detrimental to the government’s bottom line.
The Treasurer on Sunday night revealed his government had estimated the total costs of the Coalition’s proposals at $544.4 billion over the next nine years in losses. 'More than half a trillion dollars’ worth of unfunded commitments disqualifies them from any sensible conversation about deficits, debt and inflation,' Mr. Chalmers said.
