Oct 15, 2026 · 40 min · 11 segments
When tax reform moves faster than it thinks, traps will appear and adverse reactions follow. This week on Exchanges, we sit down with John Storey, Tax Counsel at The Tax Institute and one of…
John StoreyGuestEvan LucasHostAll of what we've just discussed shows very clearly, you know, back to your original point about the consultation period and about how the government has gone about this.
Again, f- this is a personal perception from what I've been seeing, particularly over the last 15 years with governments, when they do something like this, it's got, you know, 2014 with the Hockey government sort of slightly to it, and now we're seeing with the, the 2026 budget of the Chalmers budget.
Do you feel governments these days are now acting first and asking questions later? Is that sort of where we're sliding into to actually get reform done, inverted commas? 'Cause I know you support reform, but they're doing the reform and then retrospectively putting in the, the caveats.
Is, is that something that is now becoming ingrained in how we are dealing with policy?
Hope it doesn't become ingrained, but that's certainly been the approach during the, the implementation of these budget tax reforms.
It's gonna get legislated, and we'll fix it up later." Um, the motivation behind that approach, I, I, I'm not a politician.
I-- Presumably, they feel that it's, it's a better way to go about it than, than, than having long consultation periods where it gets debated in the media.
Um, get, get it out there, the media cycle moves on, and, and, and then the... it's in place.
What we're seeing is, though, so for the CGT and negative gearing changes, for example, they were passed extremely rapidly, uh, wi-within a c- space of a few weeks from budget night to being passed.
And then we had tranche two of CGT and negative gearing changes four weeks later.
So we were already correcting the legi- this w- and, and this wasn't just a, a draft that was put out there and they're tweaking it and correcting it.
The laws were passed, and then they introduced a second round of changes, partly to fill in some blanks in the first part, and then partly to correct errors.
Now, the errors, you've probably heard them, the, the so-called death tax and divorce tax and, and those sorts of, sort of, um, labels.
I mean, I've never s- experienced this in my, you know, 20-plus years as a, as a tax professional, where the tax legislation is being rolled out knowing it already has gaps and faults in it with the expectation that we'll fix them in the second and third round of changes.
Um, I've asked Treasury about that, and they said, "Well, we wanna give as much information out there as possible to, to, to, to minimize, um, to, to, you know, so to give people as much information and to, to minimize confusion." Well, [chuckles] I think it's had the complete opposite effect because this legislation comes out there, you've barely got time to consider it.
I mean, that is terrible tax policy, but it does seem to be the approach, um, certainly during this round of tax reform.
Um, extraordinarily short consultation processes, getting it out there, getting it out there quick, no time to consult.
All of what we've just discussed shows very clearly, you know, back to your original point about the consultation period and about how the government has gone about this.
Again, f- this is a personal perception from what I've been seeing, particularly over the last 15 years with governments, when they do something like this, it's got, you know, 2014 with the Hockey government sort of slightly to it, and now we're seeing with the, the 2026 budget of the Chalmers budget.
Do you feel governments these days are now acting first and asking questions later? Is that sort of where we're sliding into to actually get reform done, inverted commas? 'Cause I know you support reform, but they're doing the reform and then retrospectively putting in the, the caveats.
Is, is that something that is now becoming ingrained in how we are dealing with policy?
Hope it doesn't become ingrained, but that's certainly been the approach during the, the implementation of these budget tax reforms.
It's gonna get legislated, and we'll fix it up later." Um, the motivation behind that approach, I, I, I'm not a politician.
I-- Presumably, they feel that it's, it's a better way to go about it than, than, than having long consultation periods where it gets debated in the media.
Um, get, get it out there, the media cycle moves on, and, and, and then the... it's in place.
What we're seeing is, though, so for the CGT and negative gearing changes, for example, they were passed extremely rapidly, uh, wi-within a c- space of a few weeks from budget night to being passed.
And then we had tranche two of CGT and negative gearing changes four weeks later.
So we were already correcting the legi- this w- and, and this wasn't just a, a draft that was put out there and they're tweaking it and correcting it.
The laws were passed, and then they introduced a second round of changes, partly to fill in some blanks in the first part, and then partly to correct errors.
Now, the errors, you've probably heard them, the, the so-called death tax and divorce tax and, and those sorts of, sort of, um, labels.
I mean, I've never s- experienced this in my, you know, 20-plus years as a, as a tax professional, where the tax legislation is being rolled out knowing it already has gaps and faults in it with the expectation that we'll fix them in the second and third round of changes.
Um, I've asked Treasury about that, and they said, "Well, we wanna give as much information out there as possible to, to, to, to minimize, um, to, to, you know, so to give people as much information and to, to minimize confusion." Well, [chuckles] I think it's had the complete opposite effect because this legislation comes out there, you've barely got time to consider it.
I mean, that is terrible tax policy, but it does seem to be the approach, um, certainly during this round of tax reform.
Um, extraordinarily short consultation processes, getting it out there, getting it out there quick, no time to consult.
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