Australia Targets Crypto Gains with New Tax Policy in 2027
Darius Baruo May 11, 2026 07:19
Australia plans to replace its 50% capital gains tax discount on crypto with an inflation-adjusted model, significantly impacting long-term investors.
The Australian government is set to overhaul its tax policy on cryptocurrency and other assets, replacing the current 50% capital gains tax (CGT) discount with an inflation-based indexation model. This change, outlined in the Albanese government’s fiscal 2027 budget, could significantly raise tax obligations for long-term crypto investors.
Under the existing system, Australian investors can claim a 50% CGT discount on assets held for over 12 months. The proposed model, however, will tax full real gains adjusted for inflation over the holding period. According to the Australian Financial Review (AFR), the changes will take effect at the end of the fiscal year in July 2027, with a one-year grace period for assets acquired after May 10, 2026.
Critics, including Chris Joye, a portfolio manager at Coolabah Capital Investments, argue the shift could deter investments in productive assets like businesses and shares. Joye warned in a social media post that higher taxes—effectively doubling CGT for some investments to around 46-47%—would push capital into tax-free owner-occupied homes, reducing the attractiveness of other asset classes. "The single biggest winner from the budget: the tax-free owner-occupied home," he said.
Not everyone sees it as a deal-breaker. Scott Phillips, chief investment officer at The Motley Fool, acknowledged that while investors may face higher taxes, the potential for strong returns will still drive investment activity. "Those groups will be making a motza in the first place. That’s all the incentive they will need," Phillips commented.
For assets purchased before May 10, 2026, the government has outlined partial exemptions. The final CGT discount will be calculated proportionally based on how long the asset was held under the current vs. new tax regime. This transitional arrangement could provide some relief to existing investors, though the full details are still emerging.
The policy change underscores a broader trend of governments seeking to tighten regulations and extract more tax revenue from the growing crypto market. With implementation slated for 2027, Australian crypto investors have limited time to reassess their strategies before the new system takes hold.
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