12 May The 2026-27 Budget – responsibility, productivity and fairness – or is it?
Key Points:
- The key changes are a wind back in negative gearing, the taxation of real capital gains, numerous moves to reduce regulation, and modest net budget cuts over five years.
- The projected deficits are now slightly lower over the budget period by around $45bn, mainly due to more windfall revenue.
- With more stimulus in the near term though the Budget does nothing to make the RBA’s job in controlling inflation easier.
- The Budget continues to lock in structurally higher spending and budget deficits for the medium term.
- The tax changes look more like tax hikes than real tax reform and there is more work to do to boost productivity.