The Opposition has accused Labor of rushing through the biggest tax changes in decades, condemning a two-day Senate inquiry as “disrespectful”. The federal government is facing mounting criticism over plans to push its controversial tax reforms through Parliament before the July 2 break, with business groups accusing Labor of “needlessly and recklessly” rushing the process.
Nationals Senator Bridget McKenzie labelled the reforms an “$80 billion tax grab” and questioned why the government was attempting to push ahead with just two days of Senate scrutiny. She argued the reforms would hurt small businesses while doing little to help Australians break into the housing market.
“Millions of small businesses in this country work day in, day out. They don’t take profit. They plough it right back into their business for decades so they can grow and employ more people,” she said. “They have absolutely been copping it in the neck from this budget. No longer will our tax system encourage Australians to work hard, reinvest in their business and grow because of these changes.”
McKenzie also questioned why the changes were not announced before the election and why a broader review had not been undertaken to assess potential impacts on businesses and the wider community. “We need to have an appropriate enquiry and review, not slam through in two days — that is so disrespectful to the millions of Australians that are in small business,” she said.
“It seems with this budget everyday there’s a new problem that the government hadn’t thought about. That’s the problem with rushing these things through, and the unintended consequences will be significant and won’t just impact small businesses, they’ll impact our whole economy, because small business drives our economy. Labor thinks they’ve got all the answers, they don’t and that’s why we need an inquiry.”
The criticism comes as Labor seeks to pass legislation implementing major changes to negative gearing and capital gains tax concessions announced in last month’s federal budget. Under the reforms, negative gearing will be limited to new residential property builds from 2027-2028. Existing investment properties will retain current arrangements until they are sold. The government has also confirmed the 50 per cent capital gains tax discount will be replaced by an inflation-adjusted indexation model from July 2027, while the family home will remain exempt.
Labor MP Josh Burns defended the reforms, arguing the changes are needed to address housing affordability and boost housing supply. “Australians are currently being locked out of our housing market,” Burns said. “Too many young Australians are turning up to auctions and facing huge prices when they’re competing with investors that have huge subsidies supporting them.” Burns said the Senate inquiry was a standard part of the parliamentary process and rejected suggestions the government was failing to consult stakeholders. He said Labor had engaged with small businesses, large businesses and investment groups as it worked through the reforms.
The Coalition has threatened to withhold support for changes to the National Disability Insurance Scheme as leverage against the tax package. However, McKenzie acknowledged the NDIS required reform provided it was subject to proper parliamentary scrutiny. The debate comes a month after Treasurer Jim Chalmers handed down the federal budget, describing the housing measures as part of the government’s plan to improve affordability for first-home buyers.
