Negative gearing dumped; ASIC investigates DroneShield; Trump to meet Xi
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What is the main topic discussed in this episode?
Welcome to Fear and Greed, business news you can use.
What major changes did Treasurer Jim Chalmers announce in the budget?
Today, Federal Treasurer Jim Chalmers overhauls the capital gains tax discount and dumps negative gearing in a budget that favors the young over the old. The budget includes lower deficits for the rest of the decade, but warns of higher inflation and slower economic growth this year and next year. Also today, BHP pushes beyond $300 billion in valuation for the first time. ASIC investigates market darling DroneShield. And the U.S. President Donald Trump heads to China. It is Wednesday, the 13th of May, 2026. I'm Nadine Blaney from Ausbiz. And good morning to you, Sean Almer.
How will the new capital gains tax impact housing affordability?
Good morning, Nadine.
Did you enjoy the budget last night?
Of course I did. There is not a budget I have met that I didn't like. I guess you were up all night burning the midnight oil, getting us all across it.
Trying to understand it, that sort of thing. Yeah, a little bit.
The main story this morning, Federal Treasurer Jim Chalmers last night handed down what he called... the most important and ambitious budget in decades, including changes in taxation, the NDIS and private health insurance, housing and health and aged care. So, Sean, it's being called a reformist labor budget and started the job of shifting preferential tax treatment away from older and richer Australians toward younger Australians. Well, Sean, many of the tax changes are directly aimed at making housing more affordable.
Very much so. Starting with changes to capital gains tax, the government will scrap the capital gains tax exemption for assets held before 1985 and introduce a minimum capital gains tax rate of 30% on property and shares sold from the middle of next year. That will encourage older Australians, i.e. those in retirement, to sell investment properties. Negative gearing will be abolished for existing houses purchased from today and there'll be a minimum 30% tax on discretionary trusts. The existing 50% discount on capital gains for individuals, partnerships and trusts will be scrapped from the middle of next year and replaced with an inflation indexation model that will tax only the real gains on assets.
Yeah, the money from these initiatives will be used to fund a working Australian's tax offset of up to $250. So this will be paid annually to more than 13 million workers, people, of course. There is also a $1,000 instant deductible when filing in your tax reform or filling in, I should say, your tax reform each year. And the Treasurer Chalmers suggested there would be another tax cut by the next election due in May 2028.
So these are the handouts. Not that there's much in the short term.
What is the significance of BHP surpassing a $300 billion valuation?
On the cost side, the National Disability Insurance Scheme will be cut by $36 billion over four years by removing 300,000 people from the scheme. Private health insurance subsidies for over 65-year-olds will be cut. The inland rail freight line slated to connect Brisbane and Melbourne, well, it's going to be halted halfway in Parks NSW. There's also a $2 billion fund for local councils and utility providers. That's all about roads, water, power, sewage systems. Think about that.
What are the details of ASIC's investigation into DroneShield?
That should help homes be built. more money for hospitals, for the pharmaceutical benefit scheme, for Medicare urgent care clinics and for aged care, as well as a big chunk of cash to improve Australia's fuel security and of course money for defence. Chalmers said the changes will help rebalance a system more generous to assets than to labour.
Now, in terms of the economic parameters, the cumulative deficit between now and 2030 is $150 billion, which is about $45 billion better than the most recent estimates. And the underlying budget forecasts a return to balance by 2034-35.
What are the implications of Trump's upcoming meeting with Xi Jinping?
Yes. So we're not going to have a surplus anytime soon, but the numbers look better. That's broadly what we're saying there. Inflation forecasts have been pushed towards 5% by the middle of this year. The war in the Middle East was blamed for that.
How are business conditions and sentiment changing in Australia?
That's based on the assumption that oil prices don't rise anymore. If oil prices rise more...
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:06–0:10
2
What major changes did Treasurer Jim Chalmers announce in the budget?
0:10–0:55
3
How will the new capital gains tax impact housing affordability?
0:55–3:10
4
What is the significance of BHP surpassing a $300 billion valuation?
3:10–3:39
5
What are the details of ASIC's investigation into DroneShield?
3:39–4:22
6
What are the implications of Trump's upcoming meeting with Xi Jinping?
4:22–4:36
7
How are business conditions and sentiment changing in Australia?
4:36–6:00
8
What are the potential impacts of the new data center energy regulations?
6:00–15:50
Speakers
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