Labor's budget tax package will pass parliament next week with the Greens' support after a deal was struck to extend an inquiry into NDIS changes. The tax changes include a $250 income tax offset, $1,000 instant deduction, curbs on negative gearing, and new capital gains tax rules. The Greens secured amendments tightening SMSF property loopholes and removing broad ministerial powers.
Labor’s tax overhaul will pass through the parliament by next week with the Greens’ support, after the crossbench party agreed to vote for the laws in exchange for a two-month inquiry into the government’s NDIS changes.
The budget tax package includes a $250 income tax offset and $1000 instant deduction for workers, as well as curbs on negative gearing and a new method for calculating capital gains tax concessions. Prime Minister Anthony Albanese and the Labor government’s tax package will pass parliament by the end of next week.
The Greens secured a last-minute amendment to the laws, which will tighten a loophole around how investment properties are purchased through self-managed super funds, and persuaded Labor to remove broad ministerial powers for the treasurer of the day. The government has also expanded exemptions for small businesses with a turnover of up to $10 million, and proposed an “innovative business tax concession” for start-ups, in response to backlash over the changes.
But the thrust of the government’s tax package will otherwise become law by the end of next week. It seeks to tax income from asset sales more similarly to income earned through wages, by scrapping the 50 per cent CGT discount and taxing “real gains” made on investments at a minimum 30 per cent. Greens leader Larissa Waters said the crossbench party was still unhappy that the changes for property investors will be grandfathered.
“We are glad that the government has listened to some of the concerns raised through the inquiry process by the Greens and experts, but Labor has again ignored young people and renters,” she said. In exchange for the Greens’ support on tax, the government has agreed to extend a parliamentary inquiry into its National Disability Insurance Scheme overhaul by eight weeks.
The inquiry was supposed to deliver its report into the NDIS changes last week after just three days of hearings. The new laws will enable the government to cut future NDIS spending by $38 billion in the next four years, and remove more than 240,000 people from the scheme. Instead, the inquiry will deliver a report on August 14, and the laws will not be debated again in Parliament until then.
“The Greens will not support the NDIS bill. We will vote against it, and we will do everything we can to delay it and stop it entirely,” Waters said.
However, the Coalition has already said it plans to offer bipartisanship on the NDIS laws, meaning they are likely to pass. The federal government’s tax and NDIS changes – the centrepieces of last month’s federal budget – have been tied up in horse-trading for the last few weeks. The Greens, who hold the balance of power in the Senate, had been largely happy to help Labor pass the tax reforms but were scathing of the NDIS changes.
The Coalition, meanwhile, had offered support on the NDIS overhaul but not the tax laws. While the Greens and Coalition could have teamed up to extend inquiries into both the tax changes and NDIS laws, the left-wing crossbench party chose to negotiate with the government.is Federal Political Correspondent. She has previously reported on immigration, health, social issues and the NDIS from Parliament House in Canberra.
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