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Albo’s Pauline-powered backflip · The Front

• 0:03
  Speaker 1: From The Australian. Here's what's on the front. I'm Claire Harvey.
• 0:06
  Speaker 1: It's Friday, June nineteen, twenty twenty six. Brittany Higgins has
• 0:13
  Speaker 1: failed to account for more than one million dollars of
• 0:16
  Speaker 1: the two point four million she received in a Commonwealth
• 0:19
  Speaker 1: compensation payout. That's the finding of a trustee in bankruptcy
• 0:23
  Speaker 1: who says there's virtually nothing left of her payout. That's
• 0:27
  Speaker 1: an exclusive live now at the Australian dot com dot au.
• 0:33
  Speaker 1: It's the four hundred and seventy five million dollar backflip
• 0:36
  Speaker 1: that might make things worse. After the most bruising five
• 0:40
  Speaker 1: weeks of his prime ministership, Anthony Albanezi has announced four
• 0:44
  Speaker 1: big and very complicated changes to the controversial capital gains
• 0:48
  Speaker 1: tax and death tax measures in the budget. But will
• 0:52
  Speaker 1: it be enough to quell the fury of young investors
• 0:55
  Speaker 1: and entrepreneurs who feel the governments let them down. Greg
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  Speaker 1: Brown is here in just a moment, we.
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  Speaker 2: Back Australian small businesses and the important role that they
• 1:08
  Speaker 2: play in Australia. It's always contested, it's always contentious, but
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  Speaker 2: it will be worth it, and genuine reform is often
• 1:16
  Speaker 2: difficult but it's the right thing to do, done for
• 1:19
  Speaker 2: the right reasons.
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  Speaker 1: Greg Brown is The Australian's chief political correspondent, and Greg
• 1:24
  Speaker 1: will we expecting Anthony Albanezi and Jin Chalmers to stand
• 1:27
  Speaker 1: up on Thursday morning and make what seems to be
• 1:29
  Speaker 1: a pretty big backdown.
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  Speaker 3: We didn't expect this to come quite this early. There
• 1:34
  Speaker 3: was a little bit of scuttle by round that maybe
• 1:37
  Speaker 3: they'd look to do some of it in the next
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  Speaker 3: sitting fortnite to try and allay some of the criticisms,
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  Speaker 3: particularly in business, that they're trying to ram through this
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  Speaker 3: CGT legislation before they strike deals on concessions. But they
• 1:51
  Speaker 3: have gone further than expected with their concessions.
• 1:56
  Speaker 1: The budget was five weeks ago. It's been a nightmare
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  Speaker 1: five weeks for the government to try to deal with
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  Speaker 1: what I guess they would say has been the misrepresentation
• 2:04
  Speaker 1: of their quite reasonable changes. The anger that they've been
• 2:07
  Speaker 1: dealing with in communities has been significant, and of course
• 2:10
  Speaker 1: they're dealing with the rise of One Nation, which, as
• 2:12
  Speaker 1: you and I have discussed previously on the front, has
• 2:15
  Speaker 1: coincided with the release of this budget. How much is
• 2:18
  Speaker 1: Pauline Hanson able to claim credit for these changes that
• 2:21
  Speaker 1: we're seeing today.
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  Speaker 3: Well, Pauline Hanson certainly seemed to loom large in Anthony
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  Speaker 3: Alberze's press conference on Thursday morning.
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  Speaker 2: Well, I have a view which is consistent that I
• 2:34
  Speaker 2: think that one nation do not present alterns. I didn't
• 2:39
  Speaker 2: hear anything about costs of living.
• 2:41
  Speaker 3: She made her first ever appearance at the National Press
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  Speaker 3: Club on Wednesday, and you'd have to say, by any measure,
• 2:48
  Speaker 3: it was a political success.
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  Speaker 4: My overriding concern, and that of the people I talk to,
• 2:55
  Speaker 4: is that politicians today are good at talking but not listening.
• 3:01
  Speaker 4: They will do anything to get your vote, but when
• 3:04
  Speaker 4: that has been achieved, the voter is ignored.
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  Speaker 3: They're the two words Anthony Alberezi can't escape at the moment,
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  Speaker 3: Pauline Hansen. He was announcing big changes to what was
• 3:16
  Speaker 3: proposed in the budget, and the questions were framed around
• 3:20
  Speaker 3: what are you going to do to try and win
• 3:22
  Speaker 3: back support. Some of these changes are exactly what business
• 3:26
  Speaker 3: was calling for. For example, they've lifted quite considerably the
• 3:30
  Speaker 3: existing exemptions and concessions small businesses receive. They've lifted that
• 3:36
  Speaker 3: threshold of what is considered a small business from two
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  Speaker 3: million dollars to businesses with a turnover of ten million.
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  Speaker 3: That's quite a win for business. But don't expect many
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  Speaker 3: of the business groups to be saying that this is enough.
• 3:52
  Speaker 3: They're all now saying this is good, but we want more.
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  Speaker 1: Two million dollars does not seem like a lot in
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  Speaker 1: the turnoil of any business really in twenty twenty six, Greg,
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  Speaker 1: do you think the government got that role had a
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  Speaker 1: lack of understanding about what a small business actually is
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  Speaker 1: in this day and age.
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  Speaker 3: Yeah, that's exactly right, Claire. And that threshold had not
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  Speaker 3: changed for many years as well, so it was really
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  Speaker 3: a common sense move that they were dragged kicking and
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  Speaker 3: screaming to. To be quite frank, they've also put out
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  Speaker 3: a discussion paper for an effective carve out of the
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  Speaker 3: new CGT regime for startups. There's still a bit more
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  Speaker 3: work to do on that. That will not be included
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  Speaker 3: in the bill that the government tries to ram through
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  Speaker 3: in the Senate in the next sitting period, but the
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  Speaker 3: indicating that for businesses with a turnover of up to
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  Speaker 3: fifty million that started from nothing and are in their
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  Speaker 3: first ten years of operation, they will go under the
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  Speaker 3: old system of the fifty percent discount for the CGT
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  Speaker 3: and that goes for investors in those businesses as well.
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  Speaker 1: They use this phrase in the press conference. That really
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  Speaker 1: caught my attention was innovative businesses.
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  Speaker 3: Innovative business CGT concession. These would provide a fit.
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  Speaker 1: I think most businesses would say they're being innovative, whether
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  Speaker 1: they're running a headdressing salon or a trucking fleet, especially
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  Speaker 1: now in the age of AI when everyone is trying
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  Speaker 1: to use these new productivity tools to make a living.
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  Speaker 1: So I mean, what is an innovative business? Are we
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  Speaker 1: talking here just about tech?
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  Speaker 3: It really remains to be seen. There is a greater
• 5:29
  Speaker 3: risk within the tech sector of people going offshore. But
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  Speaker 3: it's not just tech. It's also companies that work on
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  Speaker 3: innovative solutions for other industries, such as tech solutions for
• 5:41
  Speaker 3: the financial sector or the medical sector, et cetera. The
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  Speaker 3: discussion paper does talk about the need for these businesses
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  Speaker 3: to prove that they can be scalable and achieve really
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  Speaker 3: high levels of commercialization, So it will be targeted more
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  Speaker 3: around by those definitions. It will favor the tech startups
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  Speaker 3: where it lands will be fascinating because if they go
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  Speaker 3: too narrow that will be very contentious. They'll be accused
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  Speaker 3: of favoring certain sectors. However, they've already backflipped. We'll be
• 6:17
  Speaker 3: told very firmly in the past few weeks that they're
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  Speaker 3: looking at narrow carveouts for only small firms within the
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  Speaker 3: tech sector, and now they've done something bigger for small
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  Speaker 3: business more generally.
• 6:30
  Speaker 1: The accusation that the government was bringing in a death
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  Speaker 1: tax has clearly spooked this government and we've seen Anthony
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  Speaker 1: Albanezi seeming very wounded and cabinet ministers going on breakfast
• 6:41
  Speaker 1: television trying to explain what testamentary trusts were.
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  Speaker 2: Twenty thousand discretionary trusts, but not testamentary trusts, not testimentary.
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  Speaker 1: Trust I've certainly learned a lot about what a testamentary
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  Speaker 1: trust is greet that I didn't know before. What is
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  Speaker 1: the change that they're here? And do you think this
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  Speaker 1: is an admission that it was a terrible idea in
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  Speaker 1: the first place?
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  Speaker 3: Well, this was just one oh one. I mean as
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  Speaker 3: soon as this appeared on the front page of The
• 7:09
  Speaker 3: Australian a couple of days after the budget by James Kirby,
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  Speaker 3: and the story was that if you're receiving an inheritance
• 7:16
  Speaker 3: from a discretionary testametry trust, you'll be paying higher taxes. Now,
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  Speaker 3: it's not that hard for your political opponents to frame
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  Speaker 3: that as an effective death tax. So when this came out,
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  Speaker 3: they were like, oh, no, it's rubbish. We've got no
• 7:32
  Speaker 3: death taxes, no death taxes, and it was just an
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  Speaker 3: obvious one just to kill it straight away, But they
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  Speaker 3: sort of let it run for a bit, and they
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  Speaker 3: did indicate a couple of weeks ago that they'd be
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  Speaker 3: looking at changing it possibly, and now they've an outstate
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  Speaker 3: would So if you receive your inheritance from any testamentary trust,
• 7:52
  Speaker 3: you will not be taxed at the minimum thirty percent rate.
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  Speaker 3: That's just common sense politically. I mean, we've seen how
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  Speaker 3: this plays out in campaigns, the prospect of a death tax.
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  Speaker 3: In twenty nineteen, the Labor Party, when they went to
• 8:07
  Speaker 3: the election, they had nothing resembling a death tax. Testamentary
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  Speaker 3: taxes trusts were completely carve out of their increasing taxes
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  Speaker 3: on trusts, and there were still underground campaigns that were
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  Speaker 3: very successful accusing them of having a secret death tax.
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  Speaker 3: So it was quite a political miscalculation to include testamentary
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  Speaker 3: trust within the framework of this.
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  Speaker 1: In the first place, there's two ways to look at
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  Speaker 1: this past five weeks from a political point of view.
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  Speaker 1: Greed one is that in two years time, when we're
• 8:43
  Speaker 1: finally going to an election, we'll barely remember that there
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  Speaker 1: was a five week period after the twenty twenty six
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  Speaker 1: budget when everything kind of went custard for Anthony Albineasi.
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  Speaker 1: The other way to look at it is that this
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  Speaker 1: has been an absolute disaster and that he's given away
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  Speaker 1: valuable time and airspace to pull in Hanson and he'll
• 9:02
  Speaker 1: never get that back. What's your take on it, And
• 9:05
  Speaker 1: to be fair, I'm putting you on the spot here.
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  Speaker 3: Well, the specific announcement on Thursday about the carveouts was
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  Speaker 3: a bit of a no brainer considering the pressure dar under.
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  Speaker 3: They needed to do this at the very least, and
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  Speaker 3: they're going to be phace calls to do far far more.
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  Speaker 3: But I think more generally, the problem with this budget
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  Speaker 3: is the views of the government within the community could
• 9:32
  Speaker 3: be set in stone before the government has a chance
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  Speaker 3: to turn them around, and once that happens, you're in trouble.
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  Speaker 3: And this is why the fire of the liar slogan
• 9:43
  Speaker 3: has stuck because they broke fundamental election promises. Can you
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  Speaker 3: rule out any changes to negative deering and capital gains tasts?
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  Speaker 2: How hard is it? For the fiftieth time.
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  Speaker 3: It was pretty sketchy what they did. They went to
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  Speaker 3: an election saying they weren't going to do these things,
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  Speaker 3: and then they win this massive majority. They have a
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  Speaker 3: friendly state where they know they'd probably be able to
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  Speaker 3: get in these sort of taxes, they'd be able to
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  Speaker 3: get them through the parliament. So first budget up, bang,
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  Speaker 3: they do it without really making a case for it.
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  Speaker 3: And not only that they did it without unfailing equivalent
• 10:24
  Speaker 3: income tax cuts or company tax cuts. So the problem,
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  Speaker 3: Claire could be that not only will there be a
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  Speaker 3: community view setting that Anthony Albanezi is a liar, which
• 10:37
  Speaker 3: is very damaging, there could also be another view setting
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  Speaker 3: that this government is all about raising taxes. Now the
• 10:46
  Speaker 3: government is indicating that they've got more income tax cuts
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  Speaker 3: planned ahead of the next election, but the problem for
• 10:54
  Speaker 3: them is if the community mindset is that this government
• 10:58
  Speaker 3: is just all about raising tax and that really firms
• 11:02
  Speaker 3: and then they come in before the election with brand
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  Speaker 3: new tax cuts, then maybe it will be too late
• 11:08
  Speaker 3: to change people's minds, or even to.
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  Speaker 1: Get them to believe that they're going to really do it,
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  Speaker 1: you know exactly. I was really interested in the wake
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  Speaker 1: of this budget. I really learned something about who was
• 11:18
  Speaker 1: investing and who was negative gearing. I met a young woman,
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  Speaker 1: a hairdresser married to a plumber, who was furious about
• 11:25
  Speaker 1: the changes. And this was kind of her political awakening
• 11:28
  Speaker 1: because she not being able to buy a house in
• 11:30
  Speaker 1: Sydney because the housing market is so bad, had invested
• 11:33
  Speaker 1: in three negatively geared properties in regional towns. She was
• 11:38
  Speaker 1: absolutely furious. I suspect that the government didn't expect that
• 11:41
  Speaker 1: she was the kind of person who would be angry.
• 11:44
  Speaker 1: We're not talking though about negative gearing today in these changes.
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  Speaker 1: Is the government going to hold the line on that
• 11:50
  Speaker 1: despite that fury that's out there?
• 11:52
  Speaker 3: Yeah, I think that hold the line on negative gearing, Claire.
• 11:56
  Speaker 3: It's interesting because in twenty nineteen the debate was all
• 12:00
  Speaker 3: about negative gearing. Bill Shorten had a CGT policy not
• 12:06
  Speaker 3: dissimilar to this governments, where he was going to have
• 12:09
  Speaker 3: the fifty percent discount to twenty five percent for all assets.
• 12:13
  Speaker 3: But back then that sort of went under the Ray day.
• 12:15
  Speaker 3: It was all about what negative gearing would do to
• 12:18
  Speaker 3: the housing market, whereas the COVID boom has happened since then.
• 12:24
  Speaker 3: I think now there is more community support for acting
• 12:27
  Speaker 3: to lower the growth of housing prices, even though it
• 12:31
  Speaker 3: was blatantly broken promise, and I think you'd have to
• 12:34
  Speaker 3: say they probably should have foreshadowed it and then taken
• 12:38
  Speaker 3: it to an election. But that part has been less
• 12:41
  Speaker 3: contentious than what they've done with applying a CGT change,
• 12:47
  Speaker 3: changing the regime for all assets, not just housing investment.
• 12:51
  Speaker 3: It's made a lot of people in the business community
• 12:53
  Speaker 3: wonder why they're doing it, and also a lot of
• 12:57
  Speaker 3: young people wonder why they can't avail the same investment
• 13:01
  Speaker 3: discounts as what their parents did.
• 13:03
  Speaker 1: Yeah, we're in the age of the side hustle now,
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  Speaker 1: aren't we. These smart young people who might be negatively
• 13:09
  Speaker 1: gearing investment properties, or they might be starting a business
• 13:12
  Speaker 1: or investing in some shares with their money precisely because
• 13:17
  Speaker 1: of their frustration with those traditional pathways that their parents
• 13:20
  Speaker 1: used to get a house. Do you think the government
• 13:23
  Speaker 1: didn't quite get that those are actually the people who
• 13:25
  Speaker 1: were going to be the most annoyed.
• 13:27
  Speaker 3: Yeah, I think there was a fair bit of Hubra Senate.
• 13:29
  Speaker 3: I think that they believed that the coalition was so
• 13:33
  Speaker 3: shot to pieces that they get away with it. They didn't,
• 13:36
  Speaker 3: I think, foreshadow that one nation would be a true
• 13:40
  Speaker 3: threat to them as an alternative government. There's still a
• 13:43
  Speaker 3: long way to play out before that is established. By
• 13:47
  Speaker 3: the way, they've only been ahead in one newspole so far.
• 13:51
  Speaker 3: But they would have expected the controversy to be among
• 13:56
  Speaker 3: people who already had wealth. I don't think they would
• 14:00
  Speaker 3: have anticipated that it would be so unpopular among young
• 14:03
  Speaker 3: people who were maybe just starting to build their share portfolio,
• 14:08
  Speaker 3: or who didn't have investments yet but wanted to one day.
• 14:12
  Speaker 3: The other interesting aspect of this debate, Claire, has been
• 14:16
  Speaker 3: the grandfathering aspect, which again in twenty nineteen, nobody spoke
• 14:21
  Speaker 3: about grandfathering. It just seemed like it was a done thing.
• 14:24
  Speaker 3: Whereas now, because they're selling this budget through an intergenerational lens,
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  Speaker 3: I think this is why this has been such an issue.
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  Speaker 3: All that's happened is young people have gone, well, the
• 14:37
  Speaker 3: boomers can still receive these benefits, but I won't be
• 14:40
  Speaker 3: able to. So how is this intergenerational fairness? And it's
• 14:45
  Speaker 3: been interesting because this intergenerational fairness argument only really works
• 14:49
  Speaker 3: if they were able to deliver massive income tax cuts
• 14:53
  Speaker 3: with it, and they couldn't do it because they banked
• 14:56
  Speaker 3: a lot of it, and quite frankly, they would need
• 14:59
  Speaker 3: other revenue to really make income tax cuts worth it,
• 15:02
  Speaker 3: like big ones.
• 15:03
  Speaker 1: Yeah, and maybe they just didn't want to do it at.
• 15:05
  Speaker 3: All exactly, and that might be one reason why. I've
• 15:08
  Speaker 3: also certainly declared over the past week or so, they've
• 15:12
  Speaker 3: been shifting the narrative on the budget from intergenerational equity
• 15:17
  Speaker 3: to the old class war approach, which is where I've
• 15:20
  Speaker 3: seen Jim Chalmers come out and have a go at
• 15:22
  Speaker 3: Angus Taylor for being born wealthy. I mean, you wouldn't
• 15:25
  Speaker 3: have seen language like that even six weeks ago. And
• 15:29
  Speaker 3: we're seeing Anthony Albanezi talk about Paul and Hanson receiving
• 15:34
  Speaker 3: planes from billionaires, and we've seen Wayne swanseay they need
• 15:39
  Speaker 3: to not be centrist, they need to talk like the
• 15:42
  Speaker 3: working class and deliver for them unashamedly. So there has
• 15:47
  Speaker 3: been given. The intergenerational argument has fallen flat and has
• 15:53
  Speaker 3: not resonated. The government is increasingly shifting its argument to
• 15:57
  Speaker 3: a fairness and a class war well.
• 16:01
  Speaker 1: I'm sure it won't be the last time we talk
• 16:02
  Speaker 1: about it. Thanks so much, Greg for being on the show.
• 16:05
  Speaker 3: Thank you, Claire.
• 16:10
  Speaker 1: Greg Brown is The Australian's chief political correspondent. You can
• 16:14
  Speaker 1: check out all the analysis and reporting from our experts
• 16:17
  Speaker 1: right now at the Australian dot com dot au