The Australian Senate has passed the Albanese government's controversial budget tax overhaul, enacting significant changes to capital gains tax (CGT) discounts and negative gearing rules. The legislation cleared the upper house after Prime Minister Anthony Albanese secured a deal with the Greens.
Under the reforms, the 50 percent CGT discount will be abolished, and negative gearing will be restricted to newly built properties. Provisions for existing arrangements will be grandfathered, meaning current investors will not be affected by the changes. The bill is expected to pass the House of Representatives later the same day.
The government invoked a 'guillotine' procedure to accelerate the bill's passage through parliament. This move curtailed further debate on the legislation.
Prime Minister Albanese confirmed on Tuesday that an agreement had been reached with Greens leader Larissa Waters. This deal involved closing a loophole that allowed individuals to purchase property through self-managed super funds and access a capital gains tax rate of 10 percent. According to a government statement, these changes will not alter existing tax arrangements for superannuation or impact current SMSF borrowing arrangements, and provisions are in place to finalize ongoing arrangements.
Labor MPs reportedly burst into applause following the Senate's decision. The legislation's passage through the Senate marks a key development for the government's fiscal agenda.