Dozens of politicians set to be hit by new tax on trusts

1 hour ago 3

Matthew Knott

Updated May 14, 2026 — 5:08pm,first published 11:52am

Dozens of federal politicians are set to be hit by the Albanese government’s biggest new revenue raiser in this year’s budget: the plan to introduce a 30 per cent minimum tax on discretionary trusts.

Almost one in three members of parliament – around 70 in total – have disclosed that they or a family member have at least one form of trust, with Coalition MPs the most likely to use a trust as an investment vehicle.

Queensland MP Andrew Willcox is federal parliament’s biggest user of trusts.Alex Ellinghausen

Nationals MP Andrew Willcox is easily the biggest user of trusts in parliament, listing an interest in 17 trusts in his parliamentary register.

Labor MP Libby Coker lists an interest in seven trusts, Liberal MP Rick Wilson lists six and independent MP Allegra Spender five.

Spender said she supported the government’s efforts to reduce tax concessions for trusts, as well as capital gains tax and negative gearing, to make the system fairer.

“There is evidence it is being used for income splitting, and for most people this is not an option,” Spender said.

She added that she did not expect to make any changes to her personal financial affairs as a result of the changes.

But Spender, whose Sydney seat of Wentworth is one of the country’s wealthiest electorates, added that she wanted to see more detail about the proposal and consult her constituents to ensure it did not punish people who made investment decisions in good faith.

“It is important to strike the right balance between fairness and predictability,” she said.

Victorian MP Libby Coker has declared seven trusts on her register of interests. Alex Ellinghausen

Willcox, Coker and Wilson did not respond to requests for comment.

The introduction of the minimum rate on discretionary trusts is expected to save the budget $4.4 billion in a single year after they are introduced in 2028 – more than the $3.5 billion set to be raised from changes to negative gearing and capital gains.

Around 840,000 discretionary trusts exist in Australia, and they have been commonly used to move income from a high-earning family member to a partner out of work or a child at university.

Prime Minister Anthony Albanese and Treasurer Jim Chalmers do not list any involvement with trusts in their declarations of interest.

“Currently, discretionary trusts allow some Australians, often high wealth individuals and families, to plan their tax affairs in ways that aren’t available to most people,” Chalmers, Albanese and Finance Minister Katy Gallagher said in a joint statement.

“In 2022-23, on average, families with discretionary trusts faced an average tax rate around 4 percentage points lower compared with families on similar incomes that don’t use trusts.”

Opposition Leader Angus Taylor lists at least four corporate entities and family trusts on his register of interests.

Asked about his use of trusts on Thursday, Taylor branded the government’s policy “a tax on small businesses”.

“They are people who get up every day at early hours, work incredibly hard all day, usually and very often, at least, it’s the whole family involved,” he said. “And so that structure is absolutely appropriate for that situation, and I think it should stay.”

The opposition leader lists two family trusts on his register of interests. Dominic Lorrimer

An analysis conducted by this masthead of the register of members’ interests last year found that 41 of the House of Representatives’ 151 members have declared holding at least one trust.

Fifty members of the lower house have a trust that is either held jointly with their partner or is in their partner’s name or for a child.

Labor MP David Smith lists four trusts, the same number as Liberal frontbenchers Ted O’Brien and Susan McDonald. Liberal Senator Maria Kovacic lists one trust alongside three personal businesses.

Nineteen of 76 senators in the upper house – or a quarter – list a trust, including independent senator David Pocock and Greens Senator Steph Hodgins-May.

Under the government’s changes, farming income will be exempt from the new 30 per cent minimum tax, a move welcomed by the National Farmers Federation.

“Family farms are generational businesses built over decades and often represent a family’s life savings and retirement plan. We are pleased the Government has listened,” National Farmers Federation President Hamish McIntyre said.

Deceased estates and existing testamentary trusts are also exempt from the new policy, but not distributions from new discretionary testamentary trusts.

Holding Redlich tax partner Dhanushka Jayawardena said the government’s changes had removed the tax advantage of using discretionary trusts over companies.

“With both vehicles now sitting at or around 30 per cent, and small business companies sitting below that at 25 per cent, the case for a discretionary trust collapses to non-tax considerations. Asset protection and succession planning remain valid reasons to choose a trust. Tax efficiency is no longer one of them,” Jayawardena said.