ABC News Daily Is this the bravest budget in decades?
May 12, 2026
Ian Verrender, ABC Chief Business Correspondent who covers budgets, taxation and housing policy, breaks down the 2026 budget’s major tax and housing reforms. He discusses changes to negative gearing and capital gains tax, tweaks to family trusts, and how the package aims to rebalance generational inequality. Conversation also touches on inflation risks, unemployment trends and the budget’s gradual approach.
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Inflation Forecast Hinges On War Developments
- Treasury expects inflation to peak around 5% this year then fall to about 2.5% over the next few years.
- Ian Verrender stresses this forecast is hostage to overseas developments and the duration of the Middle East conflict.
Unemployment Returning Toward Historical Norms
- Unemployment is projected to drift from historic lows into the mid‑4% range as the economy cools.
- Verrender notes this returns unemployment toward the traditional 5% 'full employment' benchmark.
Be Skeptical Of Small Universal Tax Gifts
- The budget's small universal tax measures (a $250 offset and $1,000 instant deduction) are intended to ease cost‑of‑living pain.
- Verrender warns these amounts are modest, likely quickly eroded by inflation, and costly when applied to all taxpayers.