Australian unions welcome Federal Budget 2026/27 reforms on housing, tax relief, and fuel security

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The proposed changes to capital gains tax, discretionary trusts, and more have been welcomed, alongside new worker tax relief and measures aimed at improving housing affordability and national fuel security.

Australian unions have welcomed Budget 2026/27, describing it as a move towards a fairer system for workers through measures focused on housing affordability, cost-of-living relief, and fuel security.

The Australian Council of Trade Unions (ACTU) said it supports the government’s proposed changes to negative gearing and capital gains tax, which it believes could help rebalance the housing market in favour of workers and younger Australians.

"Australian Unions led the push to reform the Howard-era taxes that drove house prices up by more than 400% – almost twice as fast as average full-time earnings – making housing wildly unaffordable."

Housing reforms aimed at easing affordability pressures

The Budget also includes AUD2bn in enabling infrastructure funding to support the construction of 65,000 new homes.

Unions said the investment could help ease housing pressures faced by working Australians, while reducing competition with professional landlords benefiting from tax breaks.

In a statement, Michele O’Neil, President, ACTU said: “This budget marks a shift that gives workers a fairer shot at housing stability through tax changes that will start to rebalance the rules.”

She added that young workers had been particularly affected by rising housing costs and tax settings that favoured investors and landlords.

“The reforms will help working families that have been pushed further away from their communities and whose rents and house prices are increasing faster than wages,” she stated.

New tax offset introduced for cost-of-living relief

Alongside the housing measures, unions also welcomed the introduction of a permanent AUD250 tax cut for workers under the Working Australians Tax Offset.

The ACTU said the measure would provide additional support for workers managing inflation and rising living expenses.

The ongoing tax offset and planned tax cuts in 2026 and 2027 would put workers first and deliver much-needed support to those who work for a living, rather than those who invest.

The union body also noted that revenue raised through changes to capital gains tax, negative gearing, and discretionary trusts would be redirected towards worker support measures.

Unions back fuel security measures

Beyond housing and tax reforms, the ACTU welcomed the government’s plans to establish a new east coast domestic gas reservation, alongside the AUD14.8bn Strengthening Australia’s Fuel Resilience package.

According to unions, the measures are important for safeguarding national fuel security and protecting jobs and communities reliant on stable fuel supplies.

O’Neil said the government had taken steps to secure fuel supplies from across the region to ensure Australians continued to have access to petrol and diesel needed to support jobs and industries.

Calls for fairer taxation through trust reforms

The ACTU also welcomed reforms targeting discretionary trusts, arguing that the changes could help create a fairer tax system.

According to the union body, average workers currently pay around 25% in tax, which it said is higher than the effective tax rates paid by some individuals using trusts and other arrangements to reduce taxable income.

O’Neil concluded by saying: “Combined with closing loopholes only available to the asset-rich using discretionary trusts, this budget is a major step forward for fairness.”

Here's a recap of some of the key budget initiatives announced in the Australian Federal Budget 2026/27:

Responding to the global oil shock

AUD7.5bn Fuel and Fertiliser Security Facility to secure additional fuel supplies from international partners
AUD3.2bn Australian Fuel Security Reserve to build up long-term fuel stocks
1bn extra litres of petrol and diesel secured for March to June
AUD1bn in interest-free loans to help manufacturing and logistics businesses keep afloat
Reserving 20% of gas exports for Australian consumers

Taking pressure off Australians

AUD250 Working Australians Tax Offset and a AUD1,000 instant tax deduction on top of three rounds of tax cuts
AUD2.9bn to more than halve the fuel excise for three months
AUD2bn for local housing infrastructure to support up to 65,000 new homes
AUD5.9bn to cut the cost of life-saving medicines

Making the economy more productive