Prime Minister Anthony Albanese has denied that his government's sweeping 18-seat majority is the reason for its backflip on capital gains tax and negative gearing, while warning that voters may start turning to "more simplistic, grievance-based politics."
Addressing the Australia's Economic Outlook 2026 summit, jointly hosted by Sky News and The Australian, Mr Albanese struck a defiant tone as business leaders demanded amendments to tax reforms passed by the House of Representatives on Thursday.
Defending the government's reversal—having pledged not to touch either investor tax benefit during the 2025 election campaign—Mr Albanese told host Andrew Clennell: "We have changed our position. Just as we changed our position in the last term on the stage 3 tax cuts because we were confronted with what is before you, and what was before us at the time, (which) was enormous pressure on cost of living."
Mr Albanese denied that Labor's increased majority or the rise of One Nation was behind the backflip on investor tax. Later, he said the Australian people "will make their judgment" on the backflip. "Part of the judgment will be, of course, on the merits of what we are doing. We're putting our case and of course, the Australian people judge," he said.
In an awkward moment, Mr Albanese was asked why he could not "win an election by telling the truth." "We did win an election," he said before continuing to discuss media pressure on his government to act on the economy.
Later, Clennell asked those in the audience with negatively geared properties to raise their hands. Mr Albanese did the same. "I have," Mr Albanese said. "Nothing wrong with that." He said those people already with negatively geared homes could keep doing so under the reforms, while younger people will still be able to invest in a negatively geared property.
Speaking on the rise of One Nation, Mr Albanese said he was concerned that "if people think the economy isn't working for them and they're working their guts out and they're not getting opportunity, they will turn to more simplistic, grievance based politics."
"What's not ideal is to see the rise of populism, whether of the Right or the Left," he said. "Populism and opportunism without answers, whether it be One Nation and the increasing blurring of the lines between the Liberal Party of One Nation and the Greens political party on the other extreme, and say everything's going OK."
In his speech, Mr Albanese defended the government's budget, rejected calls for capital gains tax changes, and pushed back on the threat from Pauline Hanson. "As we have said all along, we will engage in good faith on the detailed design of the legislation that will follow," he said.
"Over the last four years, my door has always been open to discussions with business, but this is not going to be a long, drawn-out process that ends with fiddling around the edges of the status quo. Because this moment presents a bigger opportunity for deeper co-operation."
He also rejected claims the tax reforms would deter international investment and encourage entrepreneurs to move overseas. "Whenever I meet with investors in New York, or Abu Dhabi, or Jakarta, or the EU, they want to do business here in Australia," he said. "Because whether they are building a data centre or opening a retail chain they recognise that investing in this country means buying in to a stable democracy with a skilled workforce, with an abundance of clean, cheap energy."
Without mentioning One Nation, he said Australians deserve "practical solutions, not slogans" as One Nation's surge threatens to follow sustained increases in right-wing support across Europe and the US. "If you look around the world, you can see what happens to countries and economies when people make up their minds that the system is broken beyond repair," Mr Albanese said.
"The decision for Australia is clear. We can choose whether the social and economic dislocation we see overseas is a warning that we act on or a preview of what is to come. Our government has no intention of standing around and wringing our hands about the consequences of a system that isn't working for people. Instead, we are acting to fix it."
Senator Hanson said on Monday she was still fit to be in parliament despite turning 72 last week. "My staff are flat out keeping up with me from eight o'clock in the morning till 10, 11 o'clock at night," she told 2GB radio. "I can still run down the halls of parliament in my heels when I have to get to the chamber, so don't underestimate me."
Mr Albanese said it was justified for Australians to feel like the economy wasn't "working for them," as more voters considered One Nation over the major parties. "This sentiment hasn't come out of nowhere; it is pressure that has built up, over years," he said. "And it's not just a vague feeling; it's a reality that working Australians are up against. It's something they can see for themselves. It is a logical response, not just an emotional one. And it deserves practical solutions, not slogans."
