Federal Budget 2026-27: how it affects you

Households and businesses are working through the Federal Government’s 2026-27 Budget to see how it impacts them.

Treasurer Jim Chalmers described the Budget as “responsible” despite claims the government had back tracked on election pledges not to change negative gearing and capital gains tax.

Among the announcements was an annual tax cut of up to $250 for Australian workers from 2028 and confirmed a pre-announced $1000 tax deduction to be claimed this year.

From July 1, the 16 per cent tax rate on taxable income between $18,201 and $45,000 will reduce to 15 per cent. From 1 July 2027, the same tax rate will reduce to 14 per cent.

A $20,000 instant asset write-off for small businesses with a turnover under $10 million will be permanently extended.

The government says indexation ensures only real captain gains are taxed and a new 30 per cent rate will bring the tax on real capital gains in line with the marginal tax rate.

HR Block says the Medicare levy low-income threshold will increase by 2.9 per cent from the 2025–26 financial year to help more than one million low-income individuals, families, seniors and pensioners.

The Budget also proposes limiting negative gearing for residential property investments to new builds from July 2027, says HR Block.

Properties owned on May 12, 2026 will be exempt, as will investments supporting government housing programs, including affordable housing.

Jo Szulc from Ray White Scarborough said: 

“Historically, when major tax changes are proposed, we often see some investors reassess their portfolios and consider bringing forward selling decisions before any new rules take effect.

“From a local market perspective, uncertainty around policy can influence confidence and timing, but quality properties in strong areas generally continue to see solid demand”

Moreton Bay City Council has welcomed news of $812 million funding for stage two of the Gateway Motorway Bruce Highway upgrade.

It includes collector-distributor roads either side of the highway linking Dohles Rocks Road with the Gateway Motorway and Gympie Arterial Road.

Stage two of the overall $2 billion plan to ease congestion from Bracken Ridge to North Lakes, will see two new bridges across the Pine River.

An overhaul of the National Disability Insurance Scheme (NDIS) is the biggest saving in the Australian Government’s 2026-27 Budget.

It is reported the measures to “restore the NDIS to its original intent” will save $37.8 billion over the next four years.

The move was flagged in advance with around 160,000 people likely to be cut from the NDIS in order to support people “with permanent and significant disability”.

Medicare Urgent Care Clinics have also received $3.5 billion to become a permanent part of the health system giving free care every day of the week.

$5.9 billion is going on new medicines for the Pharmaceutical Benefits Scheme PPBS) and there will be an additional $25 billion for public hospitals.

$2 billion has been allocated to the Housing Support Program- Local Structure Fund over four years from 2026-27, to help states and councils with housing infrastructure.

$100 million will be used from the Housing Australia Future Fund to provide housing for First Nationals Australians and $1.7 billion is going into incentives for aged care accommodation to boost facilities and bed numbers.

The government reiterated its decision to halve fuel excise and has announced a crackdown on fuel companies price gouging to help tackle the cost of living.

As pre-announced, $7.5 million will be spent on a Fuel and Fertiliser Facility to help safeguard Australia’s supply of both products.