The Albanese government has struck a compromise with the Greens, agreeing to adjust rules for self-managed superannuation funds in return for the minor party’s support for the Prime Minister’s Budget tax package.
Anthony Albanese confirmed on Tuesday that he had reached an agreement with Greens leader Larissa Waters, clearing the way for his proposed changes to capital gains tax and negative gearing to pass through Parliament.
As a result, the government’s plan to abolish the current 50 per cent capital gains tax discount and replace it with a new model featuring a 30 per cent flat tax alongside an inflation discount is set to become law.
Negative gearing concessions will also be scaled back, with the benefits restricted to newly constructed homes, while existing arrangements in place before May 12 will be grandfathered.
As part of the Greens deal, the federal government will move to shut down a loophole allowing investors to purchase property through self-managed super funds and access a capital gains tax rate as low as 10 per cent.
‘These changes don’t in any way change the tax arrangements for superannuation, don’t impact any existing SMSF borrowing arrangements and provide time to finalise arrangements that are in train,’ the Albanese government said in a statement.
‘Labor built superannuation and we’ll always look to make it stronger and fairer, and agreeing to these changes will reduce the risks to retirement savings while also securing passage of these important reforms to make the tax system fairer.’
Speaking at a press conference, Greens senator Nick McKim claimed the party had succeeded in “forcing Labor to go a little bit further to address housing” across Australia.
Anthony Albanese (pictured) confirmed a deal with the Greens had been struck on the budget
‘This will take some demand out of the housing market, and it will mean that there is less opportunity for people in self-managed super funds to show up to auctions and use their tax advantages to outbid renters and prospective first home buyers,’ he said.
As part of its Greens deal, the Albanese government has also agreed to extend an inquiry into its NDIS cuts by eight weeks. In the Budget, the government proposed to cut as much as $36billion from the NDIS over the next four years in a move that is expected to boot as many as 160,000 people from the scheme.
The Greens have fiercely opposed the cuts. Labor has already made a number of amendments to the NDIS bill, but the Greens say even with those changes, they will still oppose the bill.
‘We’ve heard the Liberals say some critical words about this bill,’ Greens leader Larissa Waters said.
‘Well, they need to follow through and oppose the bill. Or better yet, the government should withdraw this cruel attack on disabled people.
‘That actually is an attack on all of us, and it’s an attack on Australian values.’
A snap parliamentary inquiry’s final report on changes to the NDIS was due to be tabled on Tuesday after two extensions were granted.
However, an interim version is expected to be tabled instead, with the committee now set to deliver a final report by August 14.
Larissa Waters (pictured) and the Greens have slammed proposed changes to the NDIS
Delaying the report will grant more time to build pressure on both Labor and the Liberals to withdraw support for the bill entirely, the Greens claimed.
Waters slammed the government for trying to overhaul the NDIS – the cost of which has rapidly blown out.
‘The government is punching down on disabled people and…. proposing to make almost $40billion of savings off the back of the most vulnerable people in our community,’ she said.
‘That is disgusting. And it is a choice that the government didn’t need to make. The Greens are going to fight it for every piece that you want.’
Waters said she will push to scrap Albanese’s NDIS bill ‘entirely’.
The Albanese government praised its own deal with the Greens.
‘Passage of this important legislation this fortnight will provide workers, businesses and investors certainty about the core tax settings that will apply from July 1, 2027,’ it said in a statement.
‘The Government will continue to develop further tranches of legislation to implement the Budget tax reform package, consistent with the process for legislating other large tax reform packages in the past.’
