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May 21, 2026
PETER STEFANOVIC: Well back to the Budget CGT changes, which the government is struggling to sell even as it vows to ram the legislation through Parliament before the midwinter break. In the past 24 hours, Labor Premier Chris Minns has criticised the Albanese government's high taxation on workers whilst a former Labor Prime Minister Paul Keating has leapt to the defence of Jim Chalmers the Treasurer claiming it's just howls from wealthy business people. Even though investors aren't always wealthy, in most cases it's just students trying to earn an extra buck. Well, joining us this morning is the Shadow Defence Minister, James Paterson, for all of this. It's all very messy, James.
SENATOR JAMES PATERSON: It's pretty desperate when you're wheeling out Paul Keating to defend your budget. I mean, this is a friendless budget, and I think one thing you should notice is how few senior Labor ministers are out there defending it. It's basically been left to Albanese and Jim Chalmers to do the sell, everyone else doesn't want to touch it.
PETER STEFANOVIC: Backbenchers on this show doing their best.
SENATOR JAMES PATERSON: Yeah, we credit to them for fronting up, but really the Ministers have vacated the space. I think they know how badly this is going and how hard it is to defend publicly. But full credit to Chris Minns. He has told the truth about this budget. He has told the truth about our taxation system, and even Paul Keating actually has a pretty strong implied criticism of the government in his statement defending their CGT changes. He says capital is taxed too lightly and income is taxed too heavily. But what's the government done about income tax in this budget? They've given almost nothing back to the Australian people. If they're going to raise this extra revenue, they should have at least cut income taxes they haven't even done that.
PETER STEFANOVIC: So it kind of leads into what you're doing about indexing the tax system.
SENATOR JAMES PATERSON: Exactly.
PETER STEFANOVIC: Justifies what you are doing.
SENATOR JAMES PATERSON: We believe that income taxes in this country are too high, that Australia is too reliant on taxing people's work, and we want to give that money back to them in a tax back guarantee every single year, compared to Labor, you'll be hundreds and eventually thousands of dollars a year better off under our plan to make sure that inflation never pushes you into a higher bracket, that if you earn more just because of inflation you won't be taxed more.
PETER STEFANOVIC: What about the other comment, it's just howls from wealthy business people?
SENATOR JAMES PATERSON: I think that's incredibly tone-deaf, but reminiscent of a Labor cabinet and a Labor government that is out of touch with the business community. I mean, we've heard some amazing stories about start-ups that have been conceived in a child's bedroom that have gone on to be something really special and incredible. Because they start from a low capital base, because they started with basically nothing, almost everything is a capital gain when they sell it, and they're going to get absolutely smashed by tax at the end of the process.
PETER STEFANOVIC: Let's go to this other interesting revelation in the AFR today that seemed to suggest that Treasury changed course one month before Budget Day. So it was initially only going to apply to housing, and then they broadened it to include all asset classes with one month to go basically.
SENATOR JAMES PATERSON: This is a fascinating story by Phil Coorey this morning, because the government have been seeking to frame these changes as about improving housing affordability. But how does taxing small businesses and shares more help housing become more affordable? There's no relationship between that and housing affordability. What it reveals is this is a tax grab. This is a revenue grab. This is what this is really about. The housing affordability argument is just to dress it up and to sell it and to make it seem like it's helping young Australians, but it's not.
PETER STEFANOVIC: Because perhaps they knew it wasn't going to raise as much as they would like?
SENATOR JAMES PATERSON: I suspect that's really what is at the core of this. The government needed revenue, wanted revenue, wasn't willing to make tough decisions on the savings front, and so it's all about revenue. They try to mask a grab for cash under the blanket of housing affordability, but actually, it makes houses less affordable for young Australians because many young Australians, as you say, use shares and investments to build up their deposit so they can enter into the housing market, and it just got a lot harder for them. They will pay more taxes on those savings to get that deposit.
PETER STEFANOVIC: Well, it just shows how haphazard the whole thing has kind of been because I mean it's such a big tax change that affects so many people and businesses, the lifeblood of this community, start-ups, small businesses, etc, and then to just kind of ram it through and trying to get through parliament within a couple of weeks, it's like, wait don't we need to pump the brakes on this just a bit?
SENATOR JAMES PATERSON: I think that shows Albanese's guilty conscience here. He knows the longer this is exposed to public scrutiny, the less support it's going to have. So he wants to abridge all normal parliamentary process, have a Mickey Mouse inquiry and ram it through. And the test here I think is not just for the government, it's also for the Greens. They support these higher taxes in principle, but they should also support the principle of parliamentary oversight and scrutiny of complex new legislation like this. We need to have a proper Senate inquiry that goes for months, not weeks, so that we can get to the bottom of the detail of these changes and people have an opportunity to be heard. It shouldn't be rammed through, it shouldn't be guillotined in the Senate, it needs to have proper debate.
PETER STEFANOVIC: Well, David Shoebridge, part of our panel, coming up a little later on in the program. I will be sure to ask him about that. Let's switch topics. Pauline Hanson, James, she's about to unveil a major oil and gas policy today. So it forms a few parts. Taxpayers are going to take a direct equity stake in new exploration and drilling projects. I guess we're going to find more about it later on, but initial thoughts?
SENATOR JAMES PATERSON: I think we need to look more at the detail, particularly important with One Nation policies to understand the detail that sometimes where things go awry. And I'm personally very sceptical about effectively government owned oil and gas companies or nationalisation of the oil and gas industry. I mean, that is a policy borrowed from Venezuela and Hugo Chavez, not Australia. Of course I understand the principle that Australians want to get better return on our natural resources, that's a reasonable principle, and we can have a debate about the details of tax policy, but nationalising our oil and gas industry I don't think is the answer. Certainly not if you want to get more of it. What we need is to make it more attractive to invest in our oil and gas industry. What we need is to remove red tape and make it easier, not make it harder. And I note that Pauline Hanson is at odds with her state colleagues in South Australia, who want to lock the gate and shut new oil and gas exploration, while she's out there saying drill baby drill, she's got to reconcile those differences.
PETER STEFANOVIC: Right, but given the rise of One Nation, and again details later, but would it be enough for you to look at your policies and maybe change them?
SENATOR JAMES PATERSON: No, I mean, we will determine our own policies based on our own values and what we believe is in the national interest. And I don't think now is a good time to be increasing tax on oil and gas. I mean, this is such a critical export for us, but it is also an opportunity for us to earn in return refined fuel and diesel for our economy. It's been used as a very effective bargaining chip. And if we jeopardise our international relationships with countries like Japan and Korea and others, we make that harder, not easier.
PETER STEFANOVIC: I don't know if you can answer this question, but just in your role at Shadow Finance, just back to the discrepancy between what Jim Chalmers was saying about young people investing in shares, why his might be 1 out of 10 and ASIC saying, well, it's 2 out of 10. Wouldn't there be an accurate figure if it is a tax take? Just in your role at Shadow Finance, would that information be clear?
SENATOR JAMES PATERSON: That was a really puzzling interview, and whenever a politician is looking frantically down at their notes for help, you know they're in real trouble. I think there is ASIC data and Treasury data. There's a huge discrepancy between them. He should have been across that detail and been able to answer that question confidently. It is possible that the Treasury data is including children, as in, of course, five year olds aren't out there day trading, and the ASIC data probably could be 18 to 28 year olds, for example, but that's a discrepancy in a detail that the treasurer should be right across. This is his Budget, he's been making this claim since Budget Night. He should be able to defend it in an interview.
PETER STEFANOVIC: Ok, Shadow Defence Minister James Paterson. Thanks as always. We'll chat to you again soon.
ENDS