Australia to Propose Capital Gains Tax Changes Affecting Crypto

The Australian government is expected to reveal details of proposed capital gains tax (CGT) changes on Tuesday during budget night, which would likely affect crypto investors, according to local media reports. Treasurer Jim Chalmers is scheduled to disclose the proposal. The changes would replace the existing 50% CGT discount on assets held for more than one year with an inflation-indexed model, effectively increasing taxes on some long-term gains, including cryptocurrencies.

Proposed Policy Details

Under the reported plan, the government intends to offer a one-year grace period before the planned CGT changes take effect, according to The Australian Financial Review. Assets acquired after budget night would still qualify for the existing 50% CGT discount until mid-2027 under the proposed transition period, per the report.

Market Reaction

The planned measures have drawn criticism from market participants. Christopher Joye, chief investment officer of Coolabah Capital, expressed concern on X that the tax changes could redirect capital away from productive investments.

“After the budget doubles the capital gains tax on productive businesses/assets from circa 23.5% to 46-47%, investors will understandably pull money from businesses, shares, commercial property, and rental housing and plough it into their tax-free owner-occupied home,” said Joye.

Regulatory Context

The planned tax changes come as Australia continues advancing its broader crypto regulation. Last month, the country passed new legislation requiring “digital asset platforms” and “tokenized custody platforms” to obtain financial services licenses.