Family trusts and small businesses have been given a teensy reprieve from Labor’s so-called ‘tax reform’.
Everyone is happy about this, don’t mistake me, but gee, Albanese’s going to do his back in warming up for these policy flips…
Sorry.
This is not a backflip. We are supposed to call it a carve-out.
These things are very different. Apparently.
‘Backflip’ makes it sound as though Labor has fallen off the stage after tripping over a catastrophic policy mistake. The other is simply a change of position.
‘We anticipated, we expected, and we have seen a campaign against our sensible, commonsense changes,’ said the Treasurer, Jim Chalmers, referring to his unpopular tax reforms.
I promise this is a real quote from his appearance on the ABC, even though it reads like some sort of demented satire from a socialist rag.
‘We knew that there was an element of political risk in disturbing this broken status quo, but from my point of view, it is worth it.’
Raising taxes is risky? The French could have told you that, mate.
The SBS, which political rival Pauline Hanson put on notice for extinction last week, ventured in its headline, Chalmers concedes Labor took hit over CGT changes as Bulter rejects leadership speculation.
That probably hurt Chalmers’ feelings, although he continues to cling to the line that tax hikes on investments are good for younger Australians, despite younger Australians venting their outrage via TikTok memes.
‘If we’re given the choice between taking the easier path politically or doing the more difficult thing, but the right thing in the interests of … particularly first home buyers, young people, workers in the tax system … then it will be worth it,’ added Chalmers.
Worth it for whom? Surely not the young investors. Not the workers, either. They are smacking Labor’s hand away from their wallets while threatening to donate to One Nation’s Fire the Liar! campaign.
If we are talking about the easiest path, politically, that would be for the government to tighten its own belt and leave taxpayers alone.
Voters love it when the trappings are taken away from politicians.
As a political black comedy once said, taxpayers would prefer politicians to sit on upturned milk crates instead of chairs. Anything to save money in a way that makes Canberra uncomfortable.
Serious cost-cutting will never happen under Labor because they are too frightened to thin-out the public service in case it costs them an election.
Normally, an argument like this has merit, but this time, refusing to make those cuts could be even more dangerous to Labor’s political lifespan. The difference is Pauline Hanson saying the unspeakable while taking a page out of Reform’s book of threatening the public service rather than pandering to them, as the Coalition have done.
Meanwhile we’ve got Chalmers running two incongruous excuses about the backlash to his tax reform. What the Treasurer tries to blame on a ‘big partisan political campaign against these changes’ is then rebranded as the government listening to sharp criticism from industry.
Which is it, industry criticism or partisan smear campaigns?
Perhaps the tax reform (a phrase Treasurers should be banned from using when they mean ‘tax hikes’) is simply crap policy that contributed to Pauline Hanson creeping ahead as ‘preferred Prime Minister’ in recent polls.
If she is ‘fringe’, what does that make Albanese?
Who knows how accurate this is, but following the change of position, it was reported by SBS that Albanese might be facing leadership troubles. Health Minister Mark Butler, the chosen figure of a raised eyebrow, dismissed the whispers as ‘rubbish’.
Apparently the story originated on Channel Seven’s Sunrise with Opposition Treasurer Tim Wilson tagging Mark Butler as ‘the next person who’s going to be Prime Minister once Albo falls’.
Even if it were true, it wouldn’t make much strategic sense in the middle of a populist uprising. Butler is hardly likely to fare better against Hanson, indeed, it’s tricky to see who they could offer up. The only likeable figure in a red shirt is Toto.
At least Liberal Leader Angus Taylor came out swinging, literally, telling reporters that the Budget tax reforms needed to be ‘axed’ and that it was a ‘failed policy’.
This is probably the easiest weapon Taylor will wield.
Albanese and his Treasurer should have known better. Raising taxes is always unwelcome, but doing it in the middle of a cost-of-living crisis while the political class are enjoying some of the highest salaries in history is a good way to MacGyver a pitchfork revolution.
The problem for Taylor and the Liberals is that they’ll lose their edge if Chalmers walks the mistake back in the next few months. Even though voters should punish Labor for trying to pull a tax grab, odds are, they won’t.
Pauline Hanson’s direct attack on the public service by threatening to sack high-profile and expensive commissioners along with useless departments properly capitalised on public outrage and an ongoing frustration with Canberra’s spending problem. That is the message likely to stick.
Say what you like about One Nation’s rough edge on politics, it is certainly cutting through.
Jim Chalmers said that these carve-outs are about ‘providing more clarity and confidence to investors, more support for small businesses, and more incentives for innovation’.
The public may come to the view that the best security is to ditch Labor before they trial any more dumb ideas.
No one is happy.
Taxpayers to Jim Chalmers. https://t.co/cXx9SmvmSk
— Alexandra Marshall (@ellymelly) June 20, 2026
According to the Australian Financial Review, the business sector is still cross with them – and that is because the carve-out is hardly an improvement. The reform still leaves some businesses, who are already doing it tough, feeling as though they are being unfairly targeted while other sections of the economy are openly and outrageously rorted.
Angus Taylor gets it right when he says, mockingly, ‘I mean, this is a government that punishes businesses then says, “Oh, we’ll punish you a little less, it’s all okay…”’
Unfortunately, Labor do not appear to have suffered any serious political injuries. Come on, conservatives. Make like seagulls on a chip.
Flat White is written by Alexandra Marshall. If you would like to support her work, shout her a coffee over at donor-box.
