Labor-Greens deal on tax reforms and delayed NDIS overhaul in Australia
Consensus Summary
The Australian Labor government secured a deal with the Greens to pass controversial capital gains tax and negative gearing reforms, which will take effect from July 2027 and May 2026, respectively. The Greens agreed to support the tax bills after Labor removed a loophole allowing self-managed super funds to borrow for residential property investments. In return, the Greens secured an eight-week extension to a Senate inquiry into the governmentâs proposed $37.8 billion overhaul of the National Disability Insurance Scheme (NDIS), delaying its passage until at least mid-August. The reforms aim to address housing affordability but have faced criticism from both the Greens and the opposition Coalition for not going far enough. Greens leader Larissa Waters called the tax changes a 'small step in the right direction,' while also vowing to continue opposing the NDIS cuts, which they argue will harm over 240,000 disabled Australians. The tax legislation is expected to pass the Senate on 26 June 2026, with the NDIS inquiry now extended to 14 August to allow further scrutiny and amendments.
â Verified by 2+ sources
Key details reported by multiple sources:
- The Greens agreed to support Laborâs capital gains tax and negative gearing reforms in exchange for concessions, including removing a loophole allowing self-managed super funds (SMSFs) to borrow for residential property investments.
- The capital gains tax discount of 50% on profits from sold assets will be replaced with a cost-based indexation model from July 2027.
- Negative gearing concessions will no longer apply to investment properties bought after 7:30pm on 12 May 2026, with exceptions for new builds and government housing programs.
- The Senate inquiry into the NDIS overhaul was extended by eight weeks, with findings now due by 14 August 2026.
- Laborâs proposed NDIS changes aim to save $37.8 billion over four years, including tightening eligibility criteria and introducing independent functional assessments.
- Greens secured amendments to limit ministerial powers to cut entire categories of NDIS support, protecting daily living, assisted technology, consumables, and home modifications.
- Prime Minister Anthony Albanese stated the tax reforms are important to rebalance generational inequities, emphasizing support for hard-working Australians to own homes.
- Greens leader Larissa Waters called the tax reforms a 'small step in the right direction' but criticized them for not going far enough to address the housing crisis.
- The tax bill is expected to pass the Senate on Thursday, 2026-06-26, with opposition from the Coalition.
Points of Difference
Details reported by only one source:
- The Greens will vote against the NDIS legislation, calling it 'cruel' and harmful to over 240,000 people expected to be forced off the scheme.
- The government will need to draft a second piece of legislation to address trusts and a special capital gains tax concession for start-ups, requiring fresh negotiations with the Greens.
- Health Minister Mark Butler stated he remains 'utterly convinced' the NDIS reforms are necessary despite backlash, describing them as 'hard reform' designed carefully.
- The Coalition offered to work with the Greens to extend the NDIS inquiry for six months in exchange for more scrutiny of the tax bills, which infuriated Labor.
- The SMSF borrowing exemption change is 'prospective,' meaning contracts signed before the commencement date are protected, with a 45-day grace period for existing arrangements.
- Labor lifted the small business CGT exemption threshold from $2 million to $10 million annual turnover, and exempted testamentary trusts from the proposed 30% minimum tax rate on discretionary trusts.
- Greens economic justice spokesman Nick McKim called the reforms a 'generational opportunity' missed by Labor, though still a 'small step in the right direction.'
- The tax changes are estimated to cost the budget about $475 million over four years, according to Treasurer Jim Chalmers.
Contradictions
Conflicting information between sources:
- The Guardian states the Greens will vote against the NDIS legislation, while the ABC does not explicitly mention a Greens vote against it, only that they will 'continue to fight night and day' against the changes.
- The Guardian mentions the Coalition offered to extend the NDIS inquiry for six months in exchange for scrutiny of tax bills, but the ABC does not reference this specific offer.
Source Articles
Labor reaches deal with the Greens to pass changes to capital gains tax and negative gearing reforms
Minor party says it has also negotiated an extension to the inquiry into controversial changes to the NDIS Follow our Australia news live blog for latest updates Get our breaking news email , free app or daily news podcast The Greens will support the Albanese governmentâs negative gearing and capital gains tax changes under a deal that will delay and tweak Laborâs planned overhaul of the national disability insurance scheme. The minor party announced its position on Tuesday morning, clearing the
Labor, Greens cut deal on CGT and negative gearing
The Greens pledge their support in exchange for an end to an exemption that allows self-managed super funds to borrow money to invest in residential property, and a delay on the overhaul of the NDIS.