Federal Treasurer Jim Chalmers’s budget on Tuesday night stirred up a swathe of responses, including big support from sustainability people in the built environment and first home buyers, a mixed response from energy players and, predictably, dismay from property investors.
Most notable and perhaps controversial was the reduction of the capital gains tax (CGT) discount on investment property, coupled with the abolition of negative gearing on established homes, and reducing the CGT discount of existing homes from 50 per cent to the pre-1999 indexation model.
Polling shows that most Australians support the perhaps long overdue housing policy reforms, but not-for-profit advocacy group GetUp noted Murdoch Media’s immediate attack on Chalmers and the government, even likening his policy to the communist manifesto. We couldn’t resist sharing this excellent compilation of what out and out biased rags dare to show.
NatHERS subsidised
In good news, the Nationwide House Energy Rating Scheme will scrap accreditation fees for existing-home assessors, and current industry transition trainees will be subsidised until at least 30 June 2027.
The government is also extending support for existing homes assessors to access free software tools through magicplan, which is capped at 220 licences. The program will also work with a number of software developers to create better user interfaces, with currently seven developers interested.
What about energy and decarbonisation?
Gill Armstrong, Climateworks Centre project impact manager for cities and buildings, noted on social media, the following highlights:
- continued rollout of home batteries, with 370,000+ batteries already installed since July 2025. Although those most benefitting from battery support are those who are already relatively well-off
- reforms allowing household solar and batteries to participate directly in energy markets
- EV charging infrastructure
- broader renewable energy investments
- standards referenced in Australian legislation now free, saving small businesses and tradies up to $1600 a year
Still wanting were better solutions for:
- energy performance upgrades for existing homes to counteract the long-time legacy of under-insulated, leaky homes
- support to help renters reduce energy bills
- insulation and draught sealing – the cheapest energy bill reduction is not to need to switch on heaters & aircon in the first place
- replacing gas appliances – tax free all electric replacement appliances could be an effective tax change in future budgets
- efficient hot water – as above for heating & cooling appliances
- minimum energy standards for rental properties – we know this largely sits with States and Territories, but NCC 2028/9 should signal no gas in new homes
Green Building Council of Australia
The GBCA supported the budget, saying it appreciated a focus on housing affordability and the long-term costs of living in a house.
Chief executive Davina Rooney said funding from the Built Environment Sector Plan late last year, along with an $85 million package to support NABERS, NatHERS and Commercial Building Disclosure, will support the next phase of Australia’s housing and decarbonisation agenda.
The organisation’s important budget points include:
- $97.2 million over five years to implement the National Consumer Energy Resources Roadmap, including establishing a National Technical Regulator
- $4.5 million over four years to improve the Water Efficiency Labelling and Standards scheme
- Additional $2 billion in enabling infrastructure to support new housing developments
- $42.7 million over four years to provide free public access to Australian Standards in the National Construction Code
- funding to strengthen climate risk management across public services
- additional $17 million in 2026–27 will continue the delivery of Australia’s circular economy policy, program and legislative reforms
- funding to set up the National Environmental Protection Agency, including $36.9 million over two years to administer the Nature Repair Market
Property Council of Australia
The PCA said the property industry faced a “tightrope walk” as it was already battling high costs of labour, materials and borrowing.
Chief executive Mike Zorbas, however, thanked the government for listening to advocacy and “not hiking taxes on investment into new housing supply”. He also supported the “speed and directness” of increasing last mile infrastructure measures.
But he also added that the government should have independent modelling to monitor the months ahead to gauge the impacts of the “two lots of tax hikes”.
Clean Energy Council
The Clean Energy Council supported the government’s commitment to faster environmental approvals, including for clean energy projects. It said establishing a National EPA, progressing bilateral agreements and streamlining assessments will get shovels in the ground sooner.
It also supported other commitments, including funding for the Boyne Island Aluminium Smelter to decarbonise and transition to renewable energy, funding to implement the National Electricity Market Review and funding to implement the National Consumer Energy Resources Roadmap.
CEO Jackie Trad said there needs to be bipartisan support at the federal and state levels to ensure commitment to the timeline and resolving regulatory barriers. “We’re over halfway on progress towards delivering on our energy targets.”
Climate Council
The Climate Council said the government is still maintaining more than $19 billion in annual fossil fuel subsidies and foregone gas tax revenue “gravy train” – a sentiment which GetUp also reflected.
It pointed to a YouGov poll, which indicated most Australians want the government to expand renewable energy solutions over fossil fuels and electrify homes and transport.
CEO Amanda McKenzie said that while the government showed it was serious about intergenerational fairness, it didn’t address the climate harm falling on young people. “We can’t secure young Australians’ futures while expanding coal, oil and gas.”
It supported the $200 million in active transport, where the Active Transport Fund will receive $50 million each year, as well as the household energy roadmap and general support for renewables.
Beyond Zero Emissions
BZE said the budget left a lot to be desired, saying funding for short term fuel storage far outpaces long-term decisions that sustainably reduce fuel demand. It said energy storage shouldn’t be about fuel reserves, but rather building a domestic, renewable energy system that doesn’t rely on global supply chains in the first place.
Although it supported some of the research and development funding, it said the budget “feels like a band-aid” for Australia’s industry.
Real Estate Buyers Agent Association of Australia
REBAA says there is rising investor anger about the housing policy changes. President Melinda Jennison said the budget confirmed the direction “many investors feared”. She argues that tax changes would reduce investor participation and place further pressure on already-tight rental markets. Fewer rental homes would be on the market, which will push rents higher.
Business NSW
Business NSW said it was concerned that confidence in the market had fallen to 20 year lows. Wins in the budget include:
- permanent extension of the instant asset write-off for small businesses with turnover under $10m, with the threshold set at $20,000
- broadening access to the R&D tax incentive offset from $20m to $50m for smaller businesses. Larger businesses will benefit from a lift in the expenditure threshold from $150m to $200m
- permanently introducing two-year loss carry back for all companies up to $1b in turnover from 2026-27
- expanding tax incentives for venture capital by increasing some asset caps
- $250 Working Australians Tax Offset (from 2027/28) and a $1000 instant deduction for work-related expenses from 2026-27
- introducing loss refundability for start-ups from 1 July 2028, applicable to businesses in their first two years.
- $2b in funding for the sewage and water infrastructure necessary to deliver 65,000 new homes
- introduction of concessional and government-backed loan programs to support businesses facing high fuel, freight and energy costs.
However, it is concerned about the minimum 30 per cent tax on discretionary trusts and capital gains accrued, as well as the scrapping of the inland rail between Parkes, NSW and Brisbane, changes to the EV tax concession, tightening eligibility and increasing the cost of novated leases and fleet arrangements and increasing the passenger movement charge from $70 to $80 next year.
Australasian Railway Association
The ARA supported the budget, specifically the $1.75 billion for national freight network improvements and $3.8 billion for Victoria’s Suburban Rail Loop. CEO Caroline Wilkie said the organisation supported the strong investment, as well as new funding for the Australian Rail Track Corporation to make the freight network more productive, efficient and resilient. Wilkie said it is a time when the greater use of rail is more important than ever.
Other important rail funding includes:
- $659.6 million over three years from 2025-2026 for the high speed rail
- $76.4 million for the electrification of the Melton Line
- $55 million for the Transport Resilience and Capacity Kickstart program
- $50 million (in addition to $25 million each from the NSW and ACT governments) to deliver upgrades to the Sydney-Canberra corridors
- $1.9 million for the national freight data hub to standardise freight data
- $1 billion in interest free loans through the National Reconstruction Fund’s Economic Resilience Program for manufacturing and logistics businesses in critical supply chains