{"id":12218,"date":"2026-05-15T22:36:17","date_gmt":"2026-05-15T22:36:17","guid":{"rendered":"https:\/\/www.europesays.com\/australia\/12218\/"},"modified":"2026-05-15T22:36:17","modified_gmt":"2026-05-15T22:36:17","slug":"cgt-housing-claim-exposed-by-surprising-government-data","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/australia\/12218\/","title":{"rendered":"CGT housing claim exposed by surprising government data"},"content":{"rendered":"

The federal government\u2019s framing of changes<\/a> to the capital gains discount as addressing intergenerational inequity in the housing market has been contradicted by data showing the vast majority of CGT comes from assets other than property.<\/p>\n

Jim Chalmers handed down his fifth budget on Tuesday, in which he announced the widely reported abolishment of the 50 per cent CGT discount and a reversion to a pre-1999 CGT setting indexed against inflation.<\/p>\n

The government also announced a minimum 30 per cent tax rate on capital gains.<\/p>\n

According to the government, the move was made not as a tax grab but as part of a budget devised in the best interests of younger Australians for whom home ownership has become a pipe dream, as house prices continue to outpace real wages.<\/p>\n

The new settings to CGT and negative gearing were aimed to put downward pressure on property for investor<\/a>s.<\/p>\n

However, Australian Taxation Office data analysed by KPMG and viewed by The Australian shows capital gains on non-property assets far outstrip real estate.<\/p>\n

In the most recent five years of available data (financial years 2019 to 2023), 37.1 per cent of all capital gains made by Australian individuals came from real estate located in Australia. Of the $382.5bn of capital gains made by individuals over the five years, $141.7bn came from property.<\/p>\n

In the most recent financial year with available ATO data, financial year 2023, total capital gains made by individuals equalled $84bn. Capital gains from real estate made up 38.3 per cent ($32.3bn), gains from trusts and managed funds accounted for 35.6 per cent ($29.9bn) and gains from listed and unlisted shares in companies made up 18 per cent ($15.1bn).<\/p>\n

In financial year 2023, individual Australians had the 50 per cent discount applied to $36.5bn, or 43.4 per cent of all gains, for a net gain of $37.7bn, according to the data.<\/p>\n

KPMG partner and chief economist Brendan Rynne told The Australian the budget was \u201cnot a tax reform budget \u2013 this is a budget that is focused on gathering more tax\u201d.<\/p>\n

\u201cWhile the government is saying that this is about intergenerational equity and the rebalancing of purchases in housing, it\u2019s difficult to see that \u2026 what we do know from this (data) is that additional tax receipts are going to be gathered by the commonwealth government from these changes. <\/p>\n

\u201cYou\u2019d have to say that the first priority of these changes is to collect more tax revenue.\u201d<\/p>\n

Mr Rynne said true tax reform in the name of addressing intergenerational inequity would have focused more on boosting productivity and real wages growth to \u201copen up the purchasing power of younger generations of Australians to buy investments, including their own homes\u201d via changes to income tax settings.<\/p>\n

\u201cYes, there\u2019s some benefit in terms of resolving tax settings that may create biases towards already cashed-up investors, but ultimately you need to be doing both. And this budget has very, very little in it in terms of improving intergenerational equity,\u201d Mr Rynne said.<\/p>\n

The government claimed an additional $3.6bn in receipts would be generated over the next five years thanks to the changes to the CGT discount and negative gearing. Mr Rynne is sceptical.<\/p>\n

\u201cIt\u2019s not clear that the government\u2019s expectations of that investment behaviour is actually going to play out as anticipated, because my suspicion is that there will be a whole range of unintended consequences from these tax changes \u2013 that may cause existing property investors who are able to negatively gear existing houses to hold those assets for longer than they otherwise would.\u201d<\/p>\n

Mr Rynne said several presumptions subject to external factors would have had to be made to arrive at the $3.6bn figure, including what would be sold, at what capital gain, and the differential between the current discount and the new 30 per cent minimum.<\/p>\n

CPA Australia tax lead Jenny Wong concurred that the new budget measures did little in the way of true tax reform.<\/p>\n

\u201cMy concern is that when you apply (the CGT discount change) to all assets, there (could be) unintended consequences,\u201d she said.<\/p>\n

\u201cWhen you convert the 30 per cent minimum tax into an annual salary, I think that\u2019s about $200,000. So if you\u2019re starting out and you want to save \u2013 purchase shares with the hope that it will grow so you can sell and save for a deposit for your first home \u2013 does that mean someone earning less than $200,000 is now paying more than they have to?\u201d<\/p>\n

Leading economist Chris Richardson said the CGT changes made sense as a structural tax change but may have a limited impact on Australia\u2019s $12.3 trillion housing market.<\/p>\n

\u201cThe CGT change as it stands for me is a tax change. I don\u2019t think it\u2019s going to solve anything much in housing,\u201d he said.<\/p>\n

\u201cHousing is the biggest rock in the Australian economy, and we\u2019re talking about a tiny lever, not a big one.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"The federal government\u2019s framing of changes to the capital gains discount as addressing intergenerational inequity in the housing…\n","protected":false},"author":2,"featured_media":12219,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[13029,483,22,23,133,13032,13027,21,13043,13028,11671,9058,13024,13026,13038,13048,13046,368,13042,13037,13052,4541,13050,9912,13039,13044,13035,3180,13045,1203,3977,120,13033,13030,8776,3035,8449,13040,13031,13041,13025,13049,13051,3979,13034,13036,13047],"class_list":["post-12218","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-alan-barber","tag-anthony-albanese","tag-au","tag-australia","tag-australia-and-new-zealand","tag-australian-economy","tag-australian-individuals","tag-austrlia","tag-brendan-rynne","tag-budget-measures","tag-capital-gains","tag-chief-economist","tag-chris-richardson","tag-commonwealth-government","tag-cpa-australia","tag-death-knell","tag-discount-change","tag-getty-images-inc","tag-government-data","tag-hilary-wardhaugh","tag-home-ownership","tag-housing-market","tag-income-tax-settings","tag-intergenerational-equity","tag-intergenerational-inequity","tag-investment-behaviour","tag-jenny-wong","tag-jim-chalmers","tag-kpmg-llc","tag-national-press-club","tag-negative-gearing","tag-oceania","tag-perry-williams","tag-pipe-dream","tag-property-investors","tag-real-estate","tag-real-wages","tag-resolving-tax-settings","tag-shows-capital-gains","tag-tax-change","tag-tax-data","tag-tax-rate","tag-tax-receipts","tag-tax-reform","tag-tax-revenue","tag-tax-settings","tag-unintended-consequences"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts\/12218","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/comments?post=12218"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/posts\/12218\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/media\/12219"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/media?parent=12218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/categories?post=12218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/australia\/wp-json\/wp\/v2\/tags?post=12218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}