Australia’s 2026–27 Federal Budget puts intergenerational equity front and centre, but tax reforms reach well beyond housing. Changes to capital gains tax, negative gearing and trusts respond to decades of rising inequality, as asset prices have outpaced wages and tax settings have favoured asset owners over workers. A modest tax cut for workers follows the same logic. Together, the measures aim to share Budget pressures more fairly, ease housing challenges, and modestly lift productivity and resilience.
The spending side is less compelling. Investment in housing infrastructure is welcome, but the lack of investment in public housing is a missed opportunity. A large, jobs-light defence package dominates new spending. Meanwhile, market-driven systems in education, training and care continue to fall short. Measures to protect workers from rising prices are limited, major reforms – such as to Job Ready Graduates – are absent, and the sub-poverty JobSeeker rate remains unchanged. NDIS reforms address some issues of market provision but leave many without adequate support.
This briefing paper examines the Budget in detail, from the perspective of workers and labour markets – starting with the economic context, then assessing the tax, productivity and housing measures, and finally reviewing key spending areas including education, skills, care and income support.
Read our team’s full review of the 2026–2027 Federal Budget at the download below.