Australian news and politics live: Angus Taylor open to working with One Nation to ‘defeat Labor’

The Prime Minister says the legislation for the changes to capital gains tax discounts and negative gearing will be put to Parliament when it returns in the next fortnight.

But the changes to taxation of trusts, which have attracted strong criticism over recent days, “will take longer to develop” and will be legislated later this year.

“We’ve put in place a system where if you have a fixed trust, then you’re not impacted by any of the changes which are there. We put that out very clearly, very clearly in our budget,” Mr Albanese said.

Anthony Albanese is speaking now alongside WA Premier Roger Cook at a building site in Perth.

He was asked how West Australians can trust him on the GST, given he’s broken his promise on property taxes.

“We support WA getting its fair share of the GST because that’s the right policy for the nation,” he said.

“I’ve been very consistent.”

Mr Albanese said that he’s just handed down his Budget and has been very clear in government and in opposition about support for the 2018 GST deal.

“I back WA across the board. WA has an important role to play in our economy, and we have a very strong WA contingency in our caucus,” he said.

The Premier said that “the Prime Minister’s given us a rock-solid commitment that Western Australia will share, will receive its fair share of the GST”.

Jim Chalmers has announced a second round of reforms to the foreign investment framework that includes a new target of 30 days for all low-risk applications, and further streamlining the register of foreign-owned assets.

Some low-risk transactions won’t have to go through the approvals process at all, and those who can use exemption certificates will be expanded to reduce the regulatory burden on frequent low-risk investors.

However, the most sensitive sectors and businesses will have a targeted increase in the level of screening applied.

The full list of updates is here.

The Reserve Bank of Australia’s chief economist Sarah Hunter has warned entrenched inflation could force up interest rates and induce a recession.

In a speech about inflation and the Middle East conflict, she warned of inflation expectations leading to firms putting up prices.

“Moreover, if expectations rise persistently, it becomes harder for the central bank to bring inflation back to target, as it must both bring expectations back down and restore the balance between supply and demand,” she told the Bloomberg Forum for Investment Managers in Sydney on Tuesday.

“Doing so may require a more substantial slowing of economic activity, as we saw during the early 1990s recession.”

The RBA’s assistant governor for economic policy also suggested more price rises were likely as a result of higher fuel prices since the Iran war began in late February.

“Reports from our liaison program suggest that some firms have responded already, with fuel surcharges raised by firms at the start of supply chains that flow into a broad set of industries,” she said.

She also suggested Labor’s plans to build 1.2 million homes by mid-2029 would be difficult, given the sharp rise in construction costs.

“For example, some construction firms – who have been relatively highly exposed to transport and oil-derived raw materials cost increases – are reviewing prices for new contracts,” she said.

Jim Chalmers gave a speech at a Bloomberg event for investment managers in Sydney this morning as Labor battles to ger Aussies on board with their Budget.

The Treasurer ran through the “five pillars” of the Budget he handed down last week, and now is moving on to, as he describes it, dispelling myths about what the tax changes mean for investors.

There’s been a huge backlash from young people who have invested money in ETFs and other shares in the hope of building a house deposit.

“The impact of our changes will depend on the rate of return, the inflation rate, marginal tax rates, but there will be some people that will do better under the new arrangements than under the current arrangements,” Dr Chalmers said.

He said if you look at the average growth on the share market over the past 20 years, “investors in shares would have been equal to or a bit better off with a discount based on indexation compared to the existing policy”.

The capital gains discount, however it is calculated, only applies after assets have been held for at least a year.

“Capital gains are already taxed at marginal rates, as you know, of up to 47 per cent after applying the relevant discount. So, what we’re talking about here is the size of the discount, the calculation of the discount, which will depend on the rate of asset growth and inflation, and that’s why it’s not especially easy to perfectly compare headline tax rates on nominal gains in other countries to our new approach,” he said.

“But even for an asset with gains of 10 per cent, the effective tax rate on the nominal gain after adjusting for inflation in the past decade would be less than 37 per cent. That’s less than the rate in other jurisdictions, including California, which is a bit higher than 37 per cent,

“Treasury tells us that the average tax rate on gross capital gains will be around 21.4 per cent by the end of the medium term, that 10-year horizon, which is up from 19.3 per cent today.”

The Federal Government’s changes to capital gains taxes could see WA small businesses cop a double tax bill if they restructure to cope with the overhaul.

Business owners face stump duty when they sell equipment or plant, stock, goodwill or even licenses, client lists and business identity under State tax laws.

Under the Federal changes, which were sold as changes to make housing more affordable, businesses have been caught up in an overhaul in which capital gains taxes will be indexed to inflation.

The 50 per cent CGT discount has been replaced by the indexation measure for any assets held for more than 12 months, with a minimum 30 per cent tax on net capital gains for trusts, partnerships and individuals.

While all CGT assets — which also include shares — will be included, the Government says there will be transitional rules that confine gains changes from July 1, 2027.

Read the full story.

Prime Minister Anthony Albanese is in Perth this morning, where he is expected to speak alongside WA Premier Rodger Cook.

It comes one day after Labor was out in force in Queensland, announcing a new housing package, as the Albanese Government desperately attempts to get Australians on board with their controversial Federal Budget.

Member for Perth, Patrick Gorman, is expected to join Mr Albanese and Mr Cook on Tuesday morning.

Labor is an economic junkie that is in denial about its addiction to income tax revenue.

Since Budget night, Treasurer Jim Chalmers has been claiming he wants to be less reliant on taxing workers.

He’s told anyone who will listen that he’s been returning bracket creep.

This is despite personal income tax receipts making up an even bigger share of revenue since Labor came to power - with the dependence expected to get even worse in coming years.

Like an addict who can’t admit there’s a problem, Dr Chalmers tried to deflect attention to something else, in this case a new 30 per cent tax on family trusts from July 2028.

“Overall, this is about better aligning the tax system for workers and people who earn their income from assets and that’s why we’re making this difficult change,” he told reporters in Brisbane on Monday.

The Treasurer has also tried to position himself as the friend of the income earner, with a $250 Working Australians Tax Offset, coming into effect in July 2027, forming the centrepiece of his fifth Budget on Tuesday.

Read Stephen Johnson’s full analysis.

Treasury officials have confirmed their department was tasked with modelling specifics of Labor’s changes to negative gearing and Capital Gains Tax as far back as Christmas.

It comes as the Treasurer Jim Chalmers had cited the Iran war, which started after US-Israel led strikes on February 28, among a raft of issues for his broken promises Budget.

Fronting a parliamentary inquiry on Monday, Treasury officials revealed the major changes in the Federal Budget had been worked on for months across “summer and autumn”.

Bureaucrats Diane Brown and Shane Johnson, who were among several to appear at the Greens-led select committee on intergenerational housing inequity, confirmed the timeline following questions from Liberal Senator Maria Kovačić.

“The Treasurer outlined, in his speech to the National Press Club, the timing of these decisions,” Ms Brown said, who is the department’s deputy secretary for revenue, small business and law group.

Read the full story.

Australia has been told to “earnestly respect the legitimate rights and interests of Chinese investors” after the Albanese government forced several Beijing-linked companies and individuals to sell their stake in a critical minerals project.

Treasurer Jim Chalmers on Monday ordered six investors based in China, Hong Kong and the British Virgin Islands to divest millions of shares that they hold in WA-based Northern Minerals after previous formal directions were ignored.

Hong Kong Ying Tak Ltd, Real International Resources Ltd, Qogir Trading & Service Co Ltd, Chuanyou Cong, Vastness Investment Group Ltd and Zhongxiong Lin — have been directed to divest their holdings within 14 days.

The Prime Minister says a decision to remove a group of Chinese investors from one of the country’s most significant critical mineral deposits is about protecting Australia’s national interest and sovereignty.

On Monday, six companies and individuals based in China, Hong Kong and the British Virgin Islands were issued orders by the Treasurer to divest millions of shares that they hold in Northern Minerals after previous formal directions were ignored.

Read the full story.