Portfolio — 20 May 2026

Assistant Treasurer and Minister for Financial Services Daniel Mulino used a 20 May media release to lay out the mechanics and revenue profile of the government's capital gains tax overhaul, while simultaneously defending its treatment of small business and housing investors. The centrepiece of the reform is a structural shift away from taxing nominal gains toward taxing only real gains via an indexation method — a change Mulino framed as improving fairness between capital and labour income, not as a punitive measure on investors [TA-260520-treasu-b4dab70fd800].

Treasury projects the CGT and related reforms will raise approximately $77 billion over ten years, giving the package significant fiscal weight in the Budget envelope.

The release devoted considerable space to what does not change. All three major small-business CGT exemptions — the 15-year holding period, the retirement exemption, and active-asset concessions — continue in their current form. The qualification thresholds of $2 million in turnover or $6 million in assets remain intact.

The instant asset write-off has been made permanent, and loss-carry-back arrangements for small businesses are preserved. Mulino's consistent message is that the reform targets the structural CGT discount rather than small-business exit arrangements [TA-260520-treasu-b4dab70fd800].

Two areas of active policy design remain open. Treasury will consult the start-up sector and venture-capital community on the low-cost-base issue — a known pressure point where indexation-based CGT can produce anomalous results for early-stage companies with minimal acquisition costs. The consultation scope also extends to goodwill treatment for small businesses, suggesting the government has identified specific concerns in that community that the reform's current design does not yet fully address.

On negative gearing, Mulino confirmed the government will grandfather existing beneficiaries and will allow new-build constructions to continue to attract negative gearing [TA-260520-treasu-b4dab70fd800]. This positions the reform as prospective rather than retrospective for existing investors, while channelling new concession eligibility toward supply-side housing activity.

The broader tax relief package — Stage 3 cuts, additional cuts, the Working Australian Tax Offset and standard deductions — is cited as delivering around $2,800 in annual tax reduction for the average earner, providing the distributional counterweight to the CGT changes in the government's public account of the Budget.