Budget 2026: Celebrate the wins – but keep fighting

It is easy for progressives to find things to complain about. It’s not because we are miserable, but unfortunately, we are too aware of the realities of life for many who never get a voice, aware of the crisis of climate change, and aware of the inequalities in the system that prevent a better society.

So, when a government does a good thing, we should take a moment to celebrate – especially when it means a long and hard-fought fight has been won.

The Australia Institute first attacked the possibility of a capital gains tax discount back in August 1999 – a month before the Howard government made the change.

The topic has never been far from our minds.

In 2008, Richard Denniss noted that the “50 per cent capital gains concession costs the Commonwealth more than $7.8 billion per year in lost revenue” (by this year, that figure had increased to $21 billion).

In 2010, Richard was still battling away, using the discount as a way to reduce executive pay by arguing for “removing the tax concession on capital gains”.

The following year, in a call for Australia to raise more tax (something that continues to be our mantra) he argued for “abolishing the discount on capital gains tax that ensures that speculators who receive $100,000 when the price of an asset increases pay half the tax than someone who went to work to earn $100,000”.

This was now during a Labor government, and yet the 50% discount remained. And housing affordability declined.

The fight continued. Submissions were made to Senate inquiries on affordable housing in 2015 and on home ownership in the same year.

Senior Economist Matt Grudnoff kept pushing relentlessly for change. He researched which electorates benefited the most from the discount. Because you need to be able to talk to politicians in electoral terms.

Articles, reports, submissions, media appearances, social media posts, podcasts, webinars, videos. On and on.

In 2016 and 2019, the ALP took a policy to the electorate to reduce the discount to 25% and remove negative gearing except for new builds.

The ALP lost both elections, but importantly in 2016 won seats and in 2019 picked up a swag of votes in once-safe Liberal Party seats that in 2022 would become the “Teal seats”.

The 2019 election defeat was painted as being caused by that housing policy, but this was just history being written by winners – by those who wanted to keep the discount and negative gearing in place.

All the while, house prices kept increasing ahead of household incomes, and home ownership rates fell.

And we kept pushing, kept banging the drum, kept finding new ways to get the message across – especially to those voters, who in turn, would make it clear to the Albanese Government that not only did they favour doing something about tax and negative gearing, but they were demanding it.

You can see why.

In the 26 years before the introduction of the CGT discount, dwelling prices in Australia increased just 1.08 times faster than average household incomes; in the 26 years since, they have increased 2.3 times.

If the ratio of dwelling prices to household income was what it was in 1999, the average dwelling in Australia would cost just $596,000 rather than the current average of $1.07m.

And still, there seemed little chance of change.

A year ago, during the election campaign, I wrote a column in despair, asking, “After 25 years of the same housing policies, could Australian leaders try something else?”

And this week, they did.

The Budget removed the 50% CGT discount (except for new builds) and the same for negative gearing.

Finally, one of the worst policies of the Howard government was gone – a policy that had turned the housing market into a casino where the housing investor always won, and the prospective homeowner always lost.

This seemed obvious to many of us, but change can often take much longer than we would like. But you keep pushing, keep searching for the soft spots that make governments wince because they realise their bad economic policy is also bad politically.

When change comes, there will be many claiming responsibility, and it truly is a group effort. But I can say with little risk of error that The Australia Institute was one of the very few who were there the whole way.

This, of course, does not mean the end. Housing affordability is not solved. We desperately need more public housing. We desperately need better rental laws.

We also need to look at the Budget and lament at what was done poorly and what was poorly not done.

The cuts to the NDIS were brutal, and the lack of a 25% tax on gas exports was a missed opportunity.

That the NDIS is set to be cut by $16 billion in 2029–30, while a gas export tax would raise $17 billion, reveals just how choices are made in budgets. On Tuesday night, the government chose to cut support for people with disabilities, all because it didn’t want to upset mostly foreign-owned gas companies.

The CGT and negative gearing changes are truly worth celebrating and cheering.

But as you can see from the length of our fight to win those changes, when I say we shall continue to fight for a fair return on our gas and better support for those on low income, for better public services and for action on climate change, you can believe that means we will keep pushing for as long as it takes.