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The Federal Budget for 2026-27 has been handed down, bringing a number of changes, new programs, and reforms that will make an impact on the lives and finances of every Australian.
This year’s budget has been highly anticipated, with significant speculation around tax reforms – including changes to Capital Gains Tax and negative gearing – as well as major changes to the NDIS.
The Canstar team will be covering all the key changes and new programs throughout tonight and tomorrow – what they could mean for you.
What: Capital Gains Tax reform
- Who will it impact? Anyone selling an asset
- What is it? Capital Gains Tax will change from 1 July 2027, with the 50% discount replaced with inflation-adjusted indexation and a minimum tax rate of 30%.
What: Negative gearing restricted
- Who will it impact? Property investors that make a loss on their properties
- What is it? From 1 July 2027 negative gearing for residential property will be restricted to new builds only. Properties owned before 7.30pm, May 12 (budget night) will be exempt – so it won’t change for existing property investors.
What: Cash handout for workers
- Who will it impact? Working Australians
- What is it? Called the ‘Working Australians Tax Offset’, it is an offset of $250 which will be paid each year, beginning July 2027.
What: Minimum tax on trusts
- Who will it impact: Trustees of a discretionary trust
- What is it? From 1 July 2028, a 30% minimum tax will be introduced on discretionary trusts.
What: Private health rebate cut for over 65s
- Who will it impact? About 3 million Australians
- What does it mean? Australians who take out private health cover receive a rebate from the government (essentially a discount) which is determined by age and income. The government has announced it will reduce the rebate for those aged 65+.
- Find out what that could mean for older Australians here
What: Support for aged care residents
- Who will it impact? Aged care
- What is it? The government has announced it will invest more than $3 billion to support residents in aged care, including new beds and the ‘Support at Home’ program.
What: NDIS reform
- Who will it impact? Australians on the NDIS, service providers on the NDIS
- What is it? Eligibility for the NDIS will be tightened, with it projected to reduce participants in the program by over 160,000 over the next four years. There will also be increased regulation for providers on the program, with the goal to reduce fraud while also increasing the quality of care.
What: Increased spending on defence
- Who will it impact? Australian Defence Force
- What is it? $53 billion to be spent on Australia’s defence over the next ten years.
What: $1,000 no receipt tax deductions
- Who will it impact? Anyone who claims work expenses at tax time but doesn’t keep receipts
- What is it? Announced last year, the government will introduce a new option for tax deductions, allowing workers to claim a flat amount for expenses up to $1,000, instead of doing an itemised breakdown with every single receipt.
What: EV tax break change
- Who will it impact? Anyone considering buying an EV and using the Fringe Benefits Tax
- What is it? Labor has confirmed it will be adjusting the tax breaks for electric vehicles (part of the Fringe Benefits Tax). The change will happen over three phases, with the final phase from 1 April 2029.
What: Fuel plan
- Who will it impact? Anyone who uses petrol
- What is it? Labor has confirmed the 'Australian Fuel Security and Resilience package', which will deliver more than $10 billion into establishing a fuel security reserve, facility to increase storage and supply, and a study into fuel refining capabilities.
What: Tax rate change (confirmed in 2025)
- Who it will impact: Every tax payer
- What is it: From 1 July, the tax rates will change, with the 16% tax rate reduced to 15%. From 1 July 2027, it will reduce further, to 14%.
