CANBERRA, ACT, June 30 -- The Treasurer of Australia issued the following transcript:
Note
Subjects: superannuation, 1 July 2026 cost-of-living relief, tax reform
Peter Stefanovic:
Well, the Greens are showing some of its bargaining chips this morning - it wants Labor to force the nation's biggest companies to pay super to nearly 500,000 teenagers who work less than 30hours. Joining us live is the federal Treasurer Jim Chalmers. Treasurer, we'll start here. I mean, I seem to recall getting super from Domino's when I worked there as a kid. So, some companies do it, but not all. How do you feel about the Greens' broader super‑for‑teens push?
Jim Chalmers:
We didn't need the Greens political party to tell us that this was an important issue. As it turns out, I met with a delegation of young workers just last week talking about this. We're always looking for ways to strengthen the superannuation system. It's why, for example, we're extending the low‑income superannuation tax offset next year to benefit more than a million workers, particularly low‑paid and younger workers.
But for us the big priority right now is the big change that comes in tomorrow. From tomorrow we're paying - making sure that people get paid their super with their wages, because for too long in this country workers, particularly younger, more vulnerable low‑paid workers, have been missing out on the super that they've worked hard for and that they're entitled to. So that's the focus for us.
Stefanovic:
Right.
Chalmers:
We're always looking to improve superannuation, but we know this is an important issue, and I've been talking to young workers about it for some time.
Stefanovic:
So, where would you draw the line? I mean, do you want more and more businesses to pay more and more young people, and would that include small businesses?
Chalmers:
Well, the point that I'm making, Pete, is that we're engaging on these sorts of issues. We're always looking for ways to improve the system. But for us, our time and effort and energy has been going into this change, which comes in from tomorrow. The change that comes in from tomorrow - the payday super change - means thousands of extra dollars for workers because it makes sure that they're paid their super with their wages so that they don't miss out, they get the super that they worked hard for and that they're entitled to.
Now, the important thing about that, Pete, is that's not the only big change which is coming in tomorrow. You know, tomorrow is a really important day. We're delivering more cost-of-living help and we're delivering real change in the tax system. From tomorrow, we've got another tax cut, we've got more wage increases, we're extending paid parental leave, we're paying super on payday, and we're also extending the fuel tax relief, all from tomorrow. So, tomorrow is a really important day, and the superannuation improvements are an important part of that.
Stefanovic:
Okay, so with all of that said, and including the fuel excise, which starts to return to normal, how much do you expect that to increase inflation?
Chalmers:
Well, we expect to take the sting out of petrol prices in the month of July by extending and tapering this fuel tax relief. Now, you might have noticed, Pete, this week - I think for the first time - both petrol and diesel are cheaper now at the bowser than they were before the war started. And that's partly because of our cost-of-living relief in the form of this fuel excise cut. And so, we're extending that. We're targeting it and tapering it over the course of July, and that's because we recognise even though we've made progress on inflation, even though petrol and diesel prices have come down considerably, people are still under pressure, which is why we're providing this really important cost-of-living relief in a whole range of ways from tomorrow, the 1st of July.
Stefanovic:
Yeah, but my point is all of this is going to bump up inflation, yes?
Chalmers:
Well, inflation came down in the most recent numbers. Of course, petrol prices play out in those inflation numbers, and so this will be part of it. But we're extending this fuel tax relief because we know that people are still under pressure, despite all the progress that's been made, despite all the welcome developments in the Middle East. This cost-of-living relief that comes from tomorrow, including the fuel tax relief, is really important. This is the cost-of-living relief that Australians need and deserve, and we're providing it and extending it from tomorrow.
Stefanovic:
Okay. Let's get to the Budget. We've seen a number of changes and backflips since then. If so many issues have already emerged, how can Australians have confidence that there aren't even bigger problems ahead?
Chalmers:
Well, first of all, we're doing what we said on Budget night, which is that we are consulting on the next steps and the implementation details of the most ambitious tax-reform-package in more than a quarter of a century in this country. It's entirely normal when there are big changes in the tax system for there to be multiple pieces of legislation and for there to be consultation, and that's what we're engaged in. But we've legislated the core elements of that ambitious tax package, and what it means is we can cut taxes for workers, make it fairer for first home buyers and also make the tax system fairer more broadly as well.
Stefanovic:
All right.
Chalmers:
So, we've now bound the core elements of the tax package. We're consulting on next steps and final implementation details, and that is entirely normal when it comes to tax reform in this country.
Stefanovic:
So, are you expecting more issues to be highlighted ahead?
Chalmers:
We flagged a number of issues that we're consulting on, for example, the treatment of start‑ups, the definition of new builds, making sure that we get that right in the tax arrangements. And so, once again, this is standard practice when it comes to big tax reform, to consult on those kinds of implementation details, and that's what we're doing.
Stefanovic:
Well, just what is the definition of a new build then?
Chalmers:
Well, we laid out in the fact sheets in the Budget that a new build is something which genuinely adds to supply, and we gave some examples of that.
Stefanovic:
But is that building from scratch -
Chalmers:
We also flagged in the usual way that we would - I beg your pardon?
Stefanovic:
Is that building from scratch, or is a new build something that could still be classified as - I don't know, a year or 2 old?
Chalmers:
No, it's got to genuinely add to new supply. It's got to be a new build. It can't be, for example, a knock‑down and rebuild because that doesn't genuinely add to supply. But there are a number of examples that we provided in the Budget papers, and so I would refer people to that for the time being. But as we've said repeatedly, when it comes to legislative instruments and, indeed, to legislating these definitions, that we'll do the necessary consultation to get it right. But we've made it clear in the fact sheets that we provided on Budget night what we consider to be new or not new.
Stefanovic:
All right. Just following up the housing reports over the weekend, another weekend of low auction clearance rates. Was it your intention to crash the housing market?
Chalmers:
Of course not, and that's not what we're seeing. I mean, in the national numbers for auction clearance rates actually went up on the weekend. They were a bit softer in the 2 biggest markets, but nationally in aggregate, they came up -
Stefanovic:
They're down to 30percent, though, in your state of Queensland.
Chalmers:
No, auction clearance rates in Brisbane came up on the weekend, if you compare the preliminary numbers with the preliminary numbers from the week before. They also came up in Adelaide. They came up nationally in aggregate, as I understand it. But in Sydney and Melbourne, we saw some softness there. That actually predated the Budget announcements. So, it was pretty steady in Sydney, only down about 0.1. Melbourne was down, I think from memory, about 0.4 or 0.5. But nationally, they came up a little bit. And the same with house prices. House prices nationally in aggregate have continued to grow, but a bit more slowly. And that's what the Treasury was expecting in the Budget papers as well.
Stefanovic:
Right, but they are coming down, and it is proving that investors are, for the most part, steering clear of housing for now. Might this be a precursor to investors steering clear of businesses as well now that it's been made less attractive?
Chalmers:
No, I don't believe so. But even on the first part of your question, Pete, our objective here is to give first home buyers a fair crack at buying their first home, and what that means is not subsidising people at auctions who might be buying their 10th or 15th home. I mean, we've made our objectives really clear in that regard. We want first home buyers to get a fair crack at auctions and in the housing market more broadly. We want there to be more affordable options for people, and that's what our tax changes are all about.
But overall, in aggregate nationally, we've seen auction clearance rates come up a bit. We've seen house prices continue to grow, but more slowly. And some of those changes, some of those developments, began happening before the Budget, and that's because they reflect a whole range of factors, including interest rates and broader economic conditions and the like.
Stefanovic:
Is there any Treasury modelling that suggests your changes will increase investment in Australian businesses or improve productivity?
Chalmers:
Well, the forecasts include all of our policy changes, so they play out in some of those broader economic forecasts. But what we've made clear - I gave a speech about this at Morgan Stanley, for example - is what we are seeking to do here with these tax changes in addition to cutting taxes for workers, making it fairer for first home buyers, better aligning the tax treatment of labour and asset income. We want people to make investments based on good economic outcomes, not just seeking the best tax advantages.
And for too long in this country the tax system was overcompensating investment in established housing, and that's why we saw house prices absolutely skyrocket beyond people's capacity to get a toe‑hold in the market. So, there's been a distortion in the tax system which has overcompensated established housing for too long. By applying a fairer and more neutral treatment to the tax system and how we calculate the capital gains tax discount, then people are more likely to make investments for good economic outcomes rather than just -
Stefanovic:
Yeah, but, Treasurer, I mean, this is the point. I mean, you're bringing up that point, but so many investors have said to me, 'Well, if this is about housing,' which you've said over and over again, 'why, then, touch the share market?'
Chalmers:
Because it doesn't make a lot of sense to replace one big distortion that Howard and Costello introduced when they made that big policy mistake in 1999 and ruined the housing market for too many people, especially young people, it doesn't make sense to replace that big distortion with another big distortion. And so, we're applying this CGT discount. There's still a discount, just calculated differently, to reflect real gains. We're applying it fairly and neutrally across the board so that we don't introduce another big distortion and repeat the mistakes that were made by our predecessors a quarter of a century ago.
Stefanovic:
Yeah, but you're going to stop people from moving into the share market, though.
Chalmers:
No, I don't believe so. And it depends obviously on the inflation rate and people's marginal tax rates. But one of the things that the analysis has shown over the last couple of decades is that in some instances, some kinds of share investments have actually been undercompensated by the arrangements that we are replacing. And, you know, it's encouraged people to get into established housing in ways that has ruined the housing market for young people. And so that's the problem that we are seeking to address. That's what our tax changes are all about - cutting taxes for workers, making it fairer for first home buyers and applying a fairer and more neutral treatment across the board.
Stefanovic:
Okay. I've gone way over, but, Treasurer, appreciate your time. Thank you so much.
Disclaimer: Curated by HT Syndication.
