Property taxation remains one of the biggest talking points following the 2026 Federal Budget.
The Government has announced significant reforms to the way investment property capital gains will be taxed from 1 July 2027, alongside broader changes to negative gearing arrangements.
What’s Changing?
The current 50% Capital Gains Tax discount will be replaced with a system based on inflation indexation, together with a minimum tax rate on capital gains.
The reforms are intended to:
- Improve housing affordability
- Reduce tax concessions on investment property
- Encourage investment into new housing supply
Importantly, transitional arrangements are expected, with different treatment proposed for newly constructed properties.
Should Investors Be Worried?
Not necessarily.
While the changes are significant, they won’t apply immediately, giving investors time to:
- Review their portfolios
- Understand potential future CGT implications
- Consider how future acquisitions may be affected
Making decisions based purely on headlines rarely produces the best outcome. Instead, investors should ensure they understand how the reforms may apply to their own circumstances before acting.
