Albanese Admits One Nation’s Rise Helped Drive Controversial Tax Reforms in Federal Budget

Prime Minister Anthony Albanese has acknowledged that the rapid rise of One Nation played a role in his government’s decision to push ahead with sweeping tax reforms in this year’s federal budget a rare admission that political pressure influenced major economic policy.

Speaking at a Sky News economic summit in Sydney, Mr Albanese defended the government’s overhaul of capital gains tax and negative gearing, measures that have triggered fierce backlash from business groups and contributed to a cooling housing market. He argued the reforms were necessary to correct distortions created by the Howard government’s 1999 CGT changes, which he said had turned property into an overheated investment vehicle.

“What we’re doing is rebalancing the system so that investment decisions are driven by economic reasons, not tax outcomes,” he said.

But during a candid Q&A session after the speech, the prime minister admitted the reforms were also shaped by political realities particularly the surge in support for One Nation, which has jumped from 6 per cent to 30 per cent in one recent Redbridge poll, overtaking Labor’s primary vote.

“That is in part the context that these decisions are made,” he said. “If people think the economy isn’t working for them… they will turn to more simplistic, grievance‑based politics. And that is the context in which my government is saying: we’re going to deliver real change for the better.”

The budget measures, pitched as a way to help younger Australians enter the housing market, have so far failed to resonate. Redbridge found millennials were more likely to vote for One Nation than Labor or the Greens, while many Gen Z voters were unaware of the reforms altogether.

Mr Albanese also revealed that Treasury had modelled One Nation’s alternative negative‑gearing plan which would cap deductions at two properties rather than abolish them outright, except for new builds. Treasury warned the proposal would worsen distortions by allowing multi‑property owners to stack debt onto their highest‑value asset to maximise deductions.

“That is why we chose that model rather than one or two or five homes,” Mr Albanese said, insisting the government’s approach would boost supply while reducing distortions.

The prime minister criticised the rise of populism on both the right and left, calling it “opportunism without answers,” but said he understood voter frustration: “They don’t think the economy is working for them and they don’t want to work for the economy.”

With One Nation’s momentum reshaping the political landscape, the government’s tax reforms have become both an economic gamble and a political test one that could define the next election cycle.