00:02Prime Minister, one of your new taxes captures the income from testamentary discretionary
00:07trusts.
00:08Those kinds of trusts are often set up for people's wills.
00:13Should people preparing their inheritance now be using fixed trusts instead to avoid
00:18a fixed duty?
00:19No, it's made it very clear in the budget that testamentary trusts are not included.
00:24Do you think the changes to capital gains tax around non-property assets will impact
00:31young people's access to the market?
00:33Not at all.
00:34These changes are designed to assist young people and the truth is that our tax system
00:41and people have written in the newspapers in this country for years have spoken about the
00:48need for tax reform.
00:49What we're doing is delivering tax reform, real tax reform that treats in a fair way
00:56income that people earn from their work better aligns it with income that people legitimately
01:04earn from assets and from their wealth that they own.
01:09So better aligning those things is a sensible thing to do.
01:13The capital gains tax changes are about real gains.
01:18That is the amount in which an asset increases less inflation.
01:27That is the system that occurred right up until 1999.
01:32Before 1985 of course there was no tax in this country about capital at all.
01:39So what it is, it is only Labor that makes the big reforms.
01:45This is a difficult reform but it's one that people have spoken about for a long period of
01:51time.
01:51People have said that we need tax reform in this country.
01:54What we're doing here is delivering tax reform but with a clear objective.
02:00Tax reform to better align those income from assets compared with income from working.
02:08But importantly as well, a tax reform that will result in 75,000 Australians getting access
02:16to their first home.
02:18And our comprehensive plan for housing will make an enormous difference in this country
02:25just like this building here is literally a concrete, well a concrete and wood and carpet
02:32example of what real reform looks like.
02:36What do you say to young people that perhaps wanted to use capital gains tax, negative gearing
02:41to get ahead like their parents but now I'm not going to be able to?
02:44Well they still can.
02:46So people should talk about what's in the budget rather than some of the suggestions which
02:53are there.
02:54Young people can either, if they have currently a negative gear property then there's no change
03:01there.
03:01But if they want to, if, have a new investment, they'll invest in a new property.
03:08Now this is social and affordable housing but if this was a private build then it's new.
03:14People could invest here, get a return on that investment, have negative gearing, either
03:21choose when it comes to capital gains, either 50% discount or indexation, either one will be
03:28up to them to choose.
03:29And the difference is that not only will they be building an asset and wealth for themselves,
03:36they'll be building an asset and wealth for the nation at the same time, boosting supply.
03:44Now that is a change, that is a common sense change, one that will benefit as well, young people
03:52will benefit because at the same time they're doing that, there'll be greater supply and
03:59more opportunity for them to get into the housing market.
04:05I've known for so many people and I'm sure that you probably know people as well, who've
04:13gone along to an auction and they're bidding against an investor and they really want to
04:19live in the home that they're trying to buy.
04:23But they get outbid because the investor, because of the tax advantages which are there, has a
04:30starting point that's different.
04:32So if an investor wants to win the auction by bidding an extra $20,000 or $30,000 over the
04:41potential first homeowner, then they'll do that because they know that that leads to a higher
04:47deduction and that taxpayers are helping them in the bidding process.
04:52What we want is a level playing field and for this will assist therefore owner occupiers
05:00to get into that first home.
05:02I don't want to see the Australian dream of people owning their own home be something
05:08that we talked about, remember when it was possible.
05:12That's why we're making these changes.
05:14Prime Minister, I just want to take you back to the trusts.
05:17Why have you decided to increase tax on the testamentary trusts used regularly in people's
05:24wills?
05:25What's changed since the short-term policy?
05:28The premise of your question is completely wrong as we've explained to the Australian on
05:36a number of occasions and the premise is wrong.
05:40If you look at what is happening with trusts coming in 2028, we have a process of consultation
05:48but we've made it very clear that testamentary trusts will not be included.
05:56If there are no more questions, can I just give a shout out to Delta Goodrum who finished
06:02fourth in Eurovision this morning and did Australians proud.
06:07We're all cheering on, watching SBS, watching the coverage as the votes rolled in and Delta Goodrum
06:17I think is someone who can be very, very proud of her efforts and all Australians are proud of Delta.
06:25Well done.
06:26.
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