Australia has unveiled sweeping tax reform proposals that would remove the 50% capital gains tax discount, introduce a 30% minimum tax on net capital gains from July 2027, and limit negative gearing benefits to newly built homes as part of efforts to improve housing affordability and boost new housing supply.
Australia’s government has introduced legislation aimed at reshaping property tax concessions and easing pressure on the housing market, marking one of the country’s most significant tax reform efforts in decades.
The bill, tabled in parliament on 28 May 2026, proposes major changes to capital gains tax rules and property investor incentives as the government seeks to improve housing affordability for first-home buyers.
Under the proposal, the current 50% capital gains tax discount for assets held longer than one year would be removed. Instead, gains would be adjusted for inflation before taxation. A new 30% minimum tax on net capital gains is also planned from July 2027.
The government also intends to restrict negative gearing benefits to newly constructed homes. The move is designed to encourage investment in new housing supply rather than existing properties, while reducing competition faced by first-time buyers.
Prime Minister Anthony Albanese said the reforms are intended to create a fairer housing market, particularly for younger Australians struggling to enter the property sector. However, the measures have faced political criticism after earlier election campaign assurances that housing taxes would not change.
Industry groups and businesses have pushed for exemptions from the capital gains overhaul, arguing the changes should apply only to real estate investments.
The legislation must still pass the Senate, where the government does not hold a majority and will require support from crossbench lawmakers.
