Matters of Urgency — Taxation

Sue Lines

Senator Cash has submitted a proposal, under standing order 75, today, which is shown at item 13 on today's Order of Business:

That, in the opinion of the Senate, the following is a matter of urgency:

The Albanese Labor Government's decision to impose toxic tax changes that can punish widows, divorcees and victims of domestic violence, despite being warned of the consequences, and the need to axe these taxes.

Is consideration of the proposal supported?

More than the number of senators required by the standing orders having risen in their places—

With the concurrence of the Senate, the clerks will set the clock in line with the informal arrangements made by the whips.

Michaelia Cash

I move:

That, in the opinion of the Senate, the following is a matter of urgency:

The Albanese Labor Government's decision to impose toxic tax changes that can punish widows, divorcees and victims of domestic violence, despite being warned of the consequences, and the need to axe these taxes.

The question the Australian people are currently faced with is: what kind of Prime Minister legislates a tax that hurts widows—in other words, people who have lost their husbands—divorcees and, I think almost worse than that, women escaping domestic violence. Sadly for the Australian people, the name of that prime minister is Anthony Albanese.

Quite frankly, Labor—the Albanese Labor government—were clearly warned by the Senate and others prior to this legislation going through, and they still rushed it through the parliament. They still forced a vote in the parliament. Of course the Australian Greens were there every step of the way. And what did they do? They actually legislated, as I said, a tax that hurts widows, divorcees and women escaping domestic violence.

Sadly, this is no longer an abstract debate about some disastrous tax policy. This is about the Albanese government, those opposite, deliberately voting for a tax that is imposed upon Australians at the most vulnerable time in their lives. A woman whose husband has died will be taxed more by the Albanese government. A woman leaving a relationship, a woman getting a divorce, will be taxed more now by the Albanese government. A woman trying to escape domestic violence, separate her finances and rebuild her life with her kids—that's the real-life example that is now all over the newspapers—has been taxed more by the Albanese government. That is just sick.

But there's worse. You've got to ask yourself: how did the Prime Minister of Australia allow this to happen? How did a Labor government that, along with the Australian Greens, never, ever stops lecturing Australians about fairness, compassion and standing up for the most vulnerable in society—how in God's name do they then legislate a tax that affects the most vulnerable in society: widows, those escaping domestic violence, divorcees. I've got to say to those on the other side, to the Labor women, and even the Greens down there, who also like to pontificate, how did the self-proclaimed 'party of women' legislate a tax that creates another financial obstacle for women who are escaping domestic violence? That is just sick, quite frankly, which now appears to be the hallmark of the Albanese government.

What's worse is that Mr Albanese and the Labor Party were warned. Concerns were raised about the impact of these laws and what they could mean for property ownership changes because of death, divorce and family breakdown. The government knew that there were problems, but what did the Prime Minister do? He legislated those problems anyway. Worse, they pushed those laws through, and Labor senators voted for them.

I would have thought that we'd return to the parliament today—particularly now that there is a woman who has been affected directly by these taxes—and they'd at least have the decency to legislate that change. Get rid of the tax on the widows. Get rid of the tax on the divorcees. Get rid of the tax on, in particular, women who are escaping domestic violence with their children. Instead, when we raised it earlier today, they had the audacity to sneer at us. You should be ashamed of that.

Where's your Minister for Women? Senator Gallagher is always out there saying what a great job she's doing—seriously, legislating a tax on these people? Where's Senator Wong? She's another one who likes to pontificate. Yet again—Senator Wong, you voted for this tax on women. It is a disgrace. Let me tell you right now, if you don't abolish it, the coalition will.

Dorinda Cox

I rise to oppose this motion. It's yet another Liberal Party scare campaign dressed up as concern. They have taken some of people's hardest moments—the death of a partner, the end of a relationship or escaping family and domestic violence—and, in fact, tried to use them as cover to defend an outdated tax concession for property investors.

At the age of 17, I joined the Western Australia Police Force. I've worked alongside women and families living through family and domestic violence, and the stories that women have trusted me with have never left me. The questions they ask themselves when leaving are: 'Can I keep a roof over the head of my kids? Can I afford to start again? Will I be safe?' For someone who's lost a partner, a property may be the home they built together that holds a lifetime of memories. These are deeply personal moments. To strip away the humanity and use them to defend outdated tax concessions is absolutely beneath this Senate.

I want to be very, very clear. The Albanese Labor government will not allow victims, a widow and someone going through relationship breakdown to lose existing negative-gearing treatment simply because ownership of a property transfers. We said that we would address this in the next tranche of legislation, and that is exactly what we are going to do. Last week we released the draft legislation ensuring that property acquired from a spouse through inheritance or relationship breakdown will retain access to negative gearing if it was owned on budget night, and that includes transfers under recognised court orders, court approved agreements and binding financial arrangements.

Capital gains tax rollover interactions will also be addressed in the further legislation. These reforms do not commence until 1 July 2027. The family home remains exempt from capital gains tax. Superannuation and small-business CGT concessions are not affected. And for other inheritance there is grandfathering that will generally end where there is a need for genuine change in ownership consistent with longstanding tax arrangements. That is a reasonable and principal distinction. Legislating major reforms in tranches is a standard practice in this place. We said we would consult in good faith, and the exposure draft is open until 21 of August. Treasury have consulted banks, which confirmed that they can account for the policy in lending decisions.

So let's put those scare campaigns aside and deal with the facts today. There is no widow tax. There is no divorce tax. There is no tax on escaping violence. Senator Cash had a copy of the exposure draft. She had the protections right in front of her and she signed this notice for this debate anyway. On 5 August the shadow Treasurer, Tim Wilson, demanded more consultation, and now the coalition is condemning the reforms before the consultation has even finished. They demand a consultation and then they run a stunt like this to try to shut it down. That is the worst type of hypocrisy I have ever seen. Those opposite are fighting to preserve a system that makes it easier to buy your 10th home than your first, a system that has left fewer than half of the Australians aged between 25 and 34 owning a home. That system is not sacred. It is not fair. Our reforms direct negative gearing for future investment towards new homes, placing a blunt capital gains tax discount with indexation, and they are expected to help 75,000 Australians become homeowners. They are also helping to fund tax cuts to 13 million working Australians.

If the coalition wants to come in here and debate which party supports Australian women then let's have that debate. Since 2022, the Albanese Labor government has invested more than $4.4 billion under our National Plan to End Violence against Women and Children, and that investment has supported more than 1,400 organisations and helped 444,000 women experiencing family and domestic violence. That is the fact.

Bridget McKenzie

It gives me a great deal of pleasure to debate the fact that the Labor Party talks a lot about hypocrisy on our side of politics. The greatest hypocrites of all is the government who say they care about women, who say they care about domestic violence victims, who say they care about making sure they get first home owners into a home, yet their housing policy and their budget are delivering outcomes in direct opposition to that. The level of economic incompetence from this government knows no bounds. I have been in parliament a long time. I am yet to recall a period of time, whether in government or in opposition, when we were still talking about the mistakes in a federal budget in August. The reality is this government's economic incompetence has seen us now chasing to fix an economic mess of its own making, where its own legislation means, if you are going through a financial settlement as a divorcee, you are actually going to be subjected to the capital gains tax changes. If your partner dies, that estate will also be going through the capital gains changes. Instead of consulting and getting it right before they make it l-a-w law, we are still here eight weeks, 12 weeks—it'll be 16 weeks before we get a chance to fix it.

And that is why Australians are furious with Anthony Albanese and the Labor Party. They are not up to the job. Inflation's through the roof. Interest rates are higher than they need to be. They blame the Middle East, but, when you look across all developed countries, inflation is higher here than it is in other developed countries or like nations, and for longer than it needs to be. That is a fact, and it is because of the Labor Party's inability to manage their own spending.

As I said earlier, if a couple is separating at a time when they still have a very high mortgage to pay off, or if the couple decides as part of the divorce settlement to retain the family home in the name of one person, maybe to make sure the children of that partnership continue to remain in the family home, limiting the destabilisation of those young people—they might want to put the house up for rent—the divorcee will lose access to grandfathered negative gearing and capital gains tax laws. If the couple were already renting out an investment property, again, after the separation and transfer of assets into one name, the divorcee—potentially and often the woman—will lose access to the negative gearing arrangements available to other taxpayers who owned their home prior to 7 pm on 12 May 2026, budget night.

The government pretends this is an unintended consequence of their law. Again, really! Surprise! Not responsible! But we now know that they were advised that this would be a consequence of the decision they took, and they didn't care, because they thought no-one would notice. The reality is that property investors, in the main, are nurses, teachers and coppers—that's the data—trying to prepare a future and retirement options for themselves. Those are the people that are investing in property. And they are the people that were lied to by this Prime Minister and this Treasurer 50 times before the last election when they were told that this would not be part of—

Deborah O'Neill

Senator McKenzie, resume your seat. Minister?

Anthony Chisholm

I'd ask that Senator McKenzie withdraw.

Deborah O'Neill

Senator McKenzie, please withdraw.

Bridget McKenzie

What am I asked to withdraw? This is a fact.

Deborah O'Neill

Please take your seat and I will tell you.

Bridget McKenzie

You lie—

Deborah O'Neill

Take your seat, Senator McKenzie. I think you just used a word that you know is inappropriate. If you recalled for one second what you said, you would know appropriately responding to my request is a plain and simple withdrawal.

Bridget McKenzie

I withdraw.

The Australian public was sold a pup when the Prime Minister stood up 50 times and said there would be no changes to negative gearing. And what happened? This is why Australians are furious: if they had known, they wouldn't have voted Labor. They would have gone into the voting booth and actually been able to assess the two parties of government and what they were offering. Instead, they were sold falsehoods— (Time expired)

Long debate text truncated.