Speculation is growing that the government may revamp Australia’s capital gains tax in next month’s federal budget, amid reports Treasurer Jim Chalmers is considering scrapping the current 50 per cent discount and reverting to the pre-1999 indexation model.
Social Services Minister Tanya Plibersek would not be drawn into discussing whether changes are coming, but One Nation MP Barnaby Joyce warned Australians they were about to get “walloped with a big new tax”. He said people deserved certainty, especially those who have made long-term investment decisions based on the current rules.
“A lot of people have premised how they invest on the basis of the capital gains tax. And if you start changing things, you’re basically reaching into other people’s pockets,” he said. “I would not support a change in the capital gains tax at all.”
Plibersek avoided commenting on any potential budget measures, instead highlighting the government’s focus on housing affordability and intergenerational equity. “We’ve seen almost 300,000 people, for example, use the benefit of our 5 per cent deposit scheme to get into a home of their own,” she said. “The majority of those people wouldn’t be in a home of their own today if it wasn’t for the action that our government is taking to help Australians with home ownership.”
Asked directly whether she would like to see the capital gains tax discount removed, Plibersek again turned to the pressure many families feel about buying a home. “I am, of course, like every parent, concerned that her own children will be able to own a home of their own one day,” she said. “What I want to see is more homes built in Australia, and I want to make sure that these great programs, like the 5 per cent home deposit, are available to more people.”
Joyce argued Plibersek’s refusal to address the issue signalled more taxes were on the way, but Plibersek rejected that, describing his comments as fearmongering and “another One Nation scare campaign”.
The government has not confirmed any changes to capital gains tax ahead of the May 12 budget.
