The Credibility Gap Widens
The credibility of politicians has been shattered once again.
The Albanese Government’s blatant broken promises — made repeatedly before the last election and casually abandoned in the latest Budget — have taken political betrayal to a new level.
It’s no surprise that everyday Australians are turning away from the major parties in disgust and looking toward minority parties and independents who are willing to speak plainly.
A Budget That Punishes Savers, Retirees & Responsible Investors
For many of our clients — particularly retirees and long‑term investors — this Budget feels less like a plan for national prosperity and more like a penalty for doing the right thing.
Despite repeated assurances that major tax changes were “not on the table”, the Government has introduced significant measures that directly impact those who save, invest, and reduce pressure on the public system.
The three most important changes are:
- Major reform to Capital Gains Tax (CGT) concessions
- Restrictions on negative gearing for residential property
- Reduction in the Private Health Insurance Rebate for Australians over 65
- Capital Gains Tax Changes – A Direct Hit to Investors
From 1 July 2027, the long‑standing 50% CGT discount will be removed and replaced with inflation indexation plus a minimum 30% tax on net capital gains.
These changes apply to all CGT assets — shares, managed funds, property, crypto, collectables, and even pre‑1985 assets (for gains realised after 1 July 2027).
Only new residential builds receive special treatment.
Who is impacted most
- Self‑funded retirees who built their plans around stable tax settings
- Long‑term growth investors
- Anyone investing in their own name outside of super
Key implications
- Higher tax on long‑term investment returns
- Reduced compounding effect on retirement savings
- Increased uncertainty in investment markets
- Many retirees may need to start lodging annual tax returns again
This is not a minor adjustment — it is a fundamental structural shift.
- Negative Gearing – Major Restrictions for Property Investors
From 1 July 2027, negative gearing on established residential property will be restricted for purchases made after 7:30pm AEST on Budget night (12 May 2026).
- Losses can only be offset against other residential property income
- Excess losses can be carried forward, but not against salary or other income
- Existing properties (purchased before Budget night) are grandfathered
- Widely held trusts and super funds are largely exempt
Result: Established property becomes significantly less attractive relative to new builds, superannuation, and other asset classes.
- Private Health Insurance Rebate Cuts for Over‑65s
From 1 April 2027, the higher age‑based rebate for those over 65 will be removed, pushing older Australians back to the lower base rate.
Analysts estimate the average retired couple will face around $900 per year in additional private health insurance costs.
This comes on top of already rising premiums and cost‑of‑living pressures.
This change risks pushing more retirees out of private cover and onto an already strained public health system.
Investment Winners & Losers Under the New Rules
More Attractive Going Forward
- Superannuation (Accumulation and Pension phase) — clear standout winner
- Managed funds and ETFs held inside super
- New residential property developments
- Low‑turnover, quality equity strategies
- Income‑focused investments (franked dividends, infrastructure, AREITs)
Less Attractive Going Forward
- Established residential property (new purchases)
- High‑turnover active funds outside super
- Growth assets held in personal names
- Discretionary trusts (subject to 30% minimum tax)
Intech’s View & Recommended Actions
This Budget sends a clear message: traditional self‑reliance and long‑term planning are being penalised.
We recommend clients consider the following:
- Review portfolios for potential CGT reset opportunities before 1 July 2027
- Maximise contributions to superannuation
- Reassess property investment strategy, particularly established housing
- Increase focus on franking credit income (untouched by the changes)
- Review cashflow and private health insurance planning for retirees
Our team is already reviewing client portfolios in light of these changes.
We will be reaching out shortly to those most affected.
We remain committed to advocating for policy stability, transparency, and fairness.
We will keep you updated as further details and legislation emerge.
CM
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