The Budget 2026 live updates: Jim Chalmers explains policy shift, defends backflip on CGT and negative gearing

Treasurer Jim Chalmers’ plan to make property investment less tax-friendly could also leave ordinary shareholders and startups paying more when they sell their shares or businesses.

The Federal Government’s changes to capital gains tax have been framed as part of a broader housing affordability push, aimed at winding back the tax advantages enjoyed by property investors.

But the measures go well beyond housing.

They would replace the current 50 per cent CGT discount with an inflation-indexed system across all assets, including shares, managed funds and exchange-traded funds.

The Budget also proposes a 30 per cent minimum tax rate on capital gains — the part most alarming investor groups.

“Much of the public debate has focused on housing, but these measures also affect shareholders, small business owners, younger Australians saving and investing for a home deposit, working professionals building wealth outside the family home and self-funded retirees managing long-held investments,” said Rachel Waterhouse, chief executive of the Australian Shareholders Association.

“For many younger Australians, shares and ETFs are one of the practical ways they are trying to build a home deposit or create wealth when property ownership feels increasingly difficult. Tax changes should not make that pathway harder.”

Read more.

Tuesday’s Federal Budget confirmed what many Australians already suspected: despite mounting pressure on housing, infrastructure and the cost of living, Labor has no intention of seriously slowing migration.

Fresh Budget projections show net overseas migration remaining historically high over the next three years, despite repeated promises to rein in the numbers.

And, for voters struggling with soaring rents, mortgages and power bills, that frustration is now beginning to reshape Australian politics.

Which is why Anthony Albanese’s smug response to the Coalition’s loss in the Farrer by-election on the weekend bordered on delusional.

The Prime Minister blamed Coalition infighting and the fallout from Sussan Ley being dumped from the Liberal leadership for One Nation’s huge win. What he conveniently ignored was the far bigger message voters were sending.

Budget figures reveal nearly 765,000 migrants are expected to arrive in Australia over the next three years. New projections show the Government expects 295,000 arrivals in the current financial year, followed by 245,000 in 2026/27 and 225,000 in 2027/28.

For many Australians, it proves the Government is unwilling to confront the scale of population growth and its impact on daily life.

Read the full piece.

Jim Chalmers said it is not unfair for people to point out that Labor’s position on CGT and negative gearing has changed.

“We thought we could do enough in the housing market to focus overwhelmingly on supply and the 5 per deposits,” Dr Chalmers said.

“We needed to take on this status quo and make some difficult changes.

“I think the worst thing to do, the easier thing to do, would be to leave things as they are and understand that the longer we leave things, the worse they get.

“It is my view, increasingly my view, there is a growing sense, an accelerating sense in our society and societies like ours around the world, that there is a huge risk of people feeling disconnected and disregarded when it comes to our economy.

“In my view, the prospect of more people losing hope or more people losing connection is a problem which transcends all of others.”

Dr Chalmers was pressed of if 75,000 extra Australians getting into the housing market over 10 years is enough, or if this is just an opportunity for ideological change.

“It’s worth it for 75,000 Australians who wouldn’t otherwise get a look in in the housing market if we hadn’t taken the difficult decision we announced last night,” Dr Chalmers told The Nightly in Canberra.

The Treasurer said the status quo in the housing market and the tax system is busted, saying that the point where those two intersect creates intergenerational inequity.

“It would have been the easiest thing in the world to see that problem, to recognise that the longer we leave it, the worse it gets, and leave it unattended. That is why we took the difficult decision that we took and announced last night,” he added.

“I’d rather do the right thing by those 75,000 people and explain why a change in policy was necessary and explain that, than to leave this problem for someone else to fix down the track.

“Too many Australians, particularly young Australians, are locked out of the housing market. It requires government policy to rectify that.”

Treasurer Jim Chalmers says that Labor is confident it will meet the ambitious housing goal of building 1.2 million homes in the next few years, but there is “more to do”.

“If you think about recent developments in the housing market… when it comes to dwelling commencements, we saw commencements go up by 26 per cent last year, that’s progress,” Dr Chalmers said.

“Approvals through to March of this year were 13.1 per cent, they were falling 21.6 per cent when we came to office.

“Similar story for investment and in some of the other categories.

“We know there is heaps more to do.”

Pressed on if the Budget would push inflation, as pre-warned by the RBA,” Dr Chalmers defended his fifth Budget.

“Overall, if you look at the Budget papers and the advice we received from Treasury colleagues.... What it says is that the Budget is taking the pressure off inflation,” he said.

“We took the task of responsible economic management very seriously.”

Dr Chamers said he would not give “free advice” to the independent RBA, but said, looking at what was handed down, the Albanese Government delivered a “historically responsible document”.

“The Budget we handed down last night... is historically responsible.”

“Towards the end of last year, we had a lot going for us,” Dr Chalmers said on Wednesday.

Referencing the Iran war, Dr Chalmers said Australia was now being punished.

“The oil shock that has come with that conflict is part of a bigger pattern of rolling, accelerating turbulence in the global economy. A half-century, bookmarked by oil shocks, where one big global disruption gives rise to the next.

“In the last two decades alone, a subprime mortgage crisis, a pandemic, global inflation spike triggered by war, trade tensions. Now a huge energy shock that is pushing up prices.”

Dr Chalmers said this was reason to go harder on reform.

Treasurer Jim Chalmers is delivering his post-Budget address in Canberra,

“We didn’t finally decide on negative gearing and capital gains and trusts over the summer, though we did agree that to deliver intergenerational fairness and to rebalance the system, there needed to be tax reform,” Dr Chalmers said.

“The war fundamentally reshaped the Budget forecasts.”

“Our position is we’re going to do everything we can to stop these bad taxes, toxic taxes, from getting through the parliament,” he told Sky News.

“This is a budget of broken promises and higher taxes and less houses and lower standard of living, and we don’t want these taxes to get through because they are a tax on aspiration, a war on aspiration. They’re not going to solve any intergenerational problem.”

He argued the government’s spending had failed to deliver more housing, while placing additional financial pressure on Australians.

“We’ve seen a reduction in the number of houses getting built in this country despite billions of dollars of expenditure... there’s no shortage of areas where this government is spending and shouldn’t be spending, but because it’s spending this money, it’s whacking Australians with more taxes... when the government runs out of money, it comes after yours. And that is exactly what’s going on here.

He went further, accusing Labor of creating division between younger and older Australians.

“Australians don’t want that kind of division. They don’t believe in it. We saw that during the Voice [to parliament referendum]. Labor thinks the answer to things is to divide Australians. Well, I think it’s to unite them,” he said.

Jim Chalmers is calling his fifth Budget the most important and ambitious in decades, amid global uncertainty.

The impact of the Middle East conflict is set to last, with inflation and unemployment going up, but the Treasurer says Australia will avoid a recession and must pursue reform.

He’s announced an expected, but controversial, overhaul of negative gearing and capital gains tax for housing.

And a surprise $250 tax hand-out for workers, but you won’t see the money until late next year.

KEY TAKEAWAYS FROM FEDERAL BUDGET