Australia’s Treasurer Jim Chalmers has confirmed that the government is examining potential changes to negative gearing and the capital gains tax discount ahead of the May federal budget. The admission follows reports that Treasury is modelling a two-property limit on negative gearing, though Chalmers stressed that no final decisions have been made.
Speaking on Friday, Chalmers said it was “not unusual” for his department to consider options before a budget, but emphasised that any further steps would be a matter for cabinet. The treasurer pointed to existing government policies aimed at addressing housing affordability, including tax cuts, superannuation reforms, and initiatives to boost housing supply.
Two government sources confirmed that negative gearing is under review but played down the two-property limit reports, saying internal deliberations are not that far advanced. The government previously considered changes in 2024 but opted not to pursue them before the 2025 election, focusing on supply-side measures instead.
The opposition has signalled it would oppose any changes. Leader Angus Taylor argued that “whacking another tax on houses is not the way to get more houses.” Meanwhile, the Greens welcomed the prospect of reform, with housing spokesperson Barbara Pocock stating that “unfair tax discounts just make housing more expensive.”
