Trusts are used for asset protection, succession planning and commercial arrangements. We should not assume every small-business owner using a trust is engaged in aggressive tax avoidance. Many established their structures years ago on professional advice. The Treasury Laws Amendment (Tax Reform No. 3) Bill 2026, along with the Income Tax Rates Amendment (Minimum Tax on Discretionary Trusts) Bill 2026, introduces a minimum 30 per cent tax on relevant discretionary trust income from 1 July 2028, subject to exclusions. The trustee pays the minimum tax; eligible non-corporate beneficiaries receive a non-refundable offset for their share. Corporate beneficiaries do not receive that offset, and ordinary company tax continues to apply to distributions they receive. That matters to businesses using bucket companies. The government says denying corporate beneficiaries the offset addresses arrangements used to deter tax for underlying shareholders.

Whatever the policy intention, this is not a minor adjustment for affected businesses. Consider a family operating a wholesale business through a trust with a company as the beneficiary. They have stock to buy and equipment to maintain, and customers do not always pay promptly. They need advice about retaining their structure, changing distributions, restructuring or considering the alternative election regime. The outcome depends on the circumstances, but the uncertainty is immediate. The answer cannot simply be, 'Speak to your accountant or talk to your lawyer.' Professional advice matters, but it costs money. These questions arise because the government is changing the rules.

The non-refundable offset also deserves scrutiny. A lower-income beneficiary may not be able to use the full offset. Any excess is not simply refunded. The government must explain that clearly. Families need to understand the difference between credit they can use and money they can get back.

Treasury estimates the trust measures in schedules 1 to 3 will increase regulatory costs by an average of approximately $141.5 million annually over 10 years. That is separate from the tax payable. Behind that figure are appointments, paperwork, revised documents and decisions about business structures. In a family business, there's usually no compliance department. It is the same person ordering supplies, serving customers, managing staff and checking the accounts at night.

The No. 3 bill provides transitional rollover relief for eligible restructures involving transfers from 1 July 2027 to 30 June 2030. I acknowledge that relief, but rollover relief does not mean cost-free restructuring. It generally defers eligible income tax consequences. It does not permanently erase accrued gains or remove liabilities under other laws. GST, fringe benefits tax and state and territory duties continue to operate.

The impact analysis estimates average restructuring costs at around $11,000. They also record stakeholder estimates, including a range of $15,000 to $50,000 reported by COSBOA. Not every business will face those costs, but they show why owners are concerned.

The relief also has conditions. Generally, required assets must be transferred within the transitional period. The explanatory memorandum gives an example where retaining a substantial property asset that is not excluded makes relief unavailable for the restructure's transfers. There are also continuing requirements, and certain changes can reverse previously claimed relief. Businesses need practical guidance before making decisions, not after discovering they have lost the relief.

That brings me to R&D under the No. 4 bill. Schedule 2 increases offset rates and will raise the turnover threshold relevant to refundable support, but it also raises the general minimum expenditure threshold from $20,000 to $50,000, limits refundability by reference to business history and removes the separate category of supporting R&D activities. A higher rate does not help if your expenditure no longer qualifies. Everyone would agree that R&D is vital for Australia's future economic prosperity. It is the foundation for strengthening existing industries and growing new enterprises that can compete in the global marketplace amid astonishing technological change. If we don't get R&D right, we are in trouble, and, to get it right, we need to listen closely to people who are at the cutting edge.

I received feedback from Josh Jeffress at Design Anthology, drawing on his experience of helping Australian businesses develop physical products. His message is straightforward:

Don't cut the bottom out of Australia's innovation pipeline.

He said developing a product involves more than a single experiment. Businesses investigate existing technology, prepare components, build experimental equipment and develop prototypes or test rigs. They collect data, identify failures, make changes and test again. That preparation can make experimentation possible.

The No. 4 bill makes it clear that an activity does not qualify merely because it supports eligible R&D. It allows additional integral activities to be prescribed. Some activities may qualify independently or under a future instrument. But businesses need certainty before committing money. Finding out early that an idea will not work can prevent much greater expenditure on something technically unviable. That is not wasted effort; it is informed decision-making.

Josh also warns that development costs and delays can slow commercialisation, giving overseas competitors time to make the first move. Not every commercial activity should attract an R&D concession, but necessary experimental work should not fall through a gap because the rules fail to reflect how products are developed.

There's another issue—the proposed time limits on refundable support. The reforms generally limit access to the refundable offset to a company's first 10 years, with an extended 15-year window for eligible therapeutic goods research. Developing a medicine can take 10 to 20 years from discovery through development and approval. As we often say, overnight success can take more than two decades. What happens when a company reaches the eligibility limit while still undertaking trials and making genuine scientific progress but is years away from a marketable treatment? The clock is linked to business history, not a fresh 15-year window for every treatment. The government must explain why that cut-off appropriately reflects medical research timelines and what assessment it has made of the funding consequences. We should expect accountability for public support, but we should not assume a company's age tells us whether its research still needs support. These are the precise questions the parliament needs time to examine.

Across these bills, people need rules they can understand before making decisions. For the trust measures, I want clear examples, accessible support and meaningful engagement with business owners and advisers about how corporate beneficiaries and existing arrangements work. For R&D, I ask the government to reconsider removing supporting activities and explain how necessary experimental work will remain supported. The government should answer these questions directly and in detail in this chamber. A cognate debate should not become a shortcut for that scrutiny.

The owners at the Fowler business forum deserve more than an assurance that the reform will improve fairness. They deserve to know what it means for their business. Think of a mum and dad at the laundromat, a mechanic or a family with a few restaurants. They are not asking for special treatment. They are asking to be treated fairly, to know the rules in advance and to be allowed to build something for the next generation. A fair tax system should collect the revenue we need while treating people reasonably. It should recognise the time, money and risk involved in running a business and give people a practical opportunity to turn good ideas into successful Australian products.

Small businesses are not just taxpayers; they are employers whose staff also pay taxes. If we make it harder for them to survive, invest and grow, the government should consider the question that business owners ask me: where will the taxes come from if we make it so hard for them to work, run a business and employ people? So I again say to the government: please pause, listen and take these changes to the people.