Australia's tax reforms push young investors toward riskier assets

Australia’s federal government is overhauling its capital‑gains tax and negative‑gearing rules. From 1 July 2027 the 50 % CGT discount will be replaced by an inflation‑adjusted 30 % minimum tax, and negative‑gearing concessions will be limited to newly built dwellings, with existing properties grandfathered.

Despite the changes, micro‑investment platforms report that younger investors are moving up the risk ladder. Raiz chief executive Craig Keary said, “We’re seeing as twice as many customers move up the risk ladder… they are turning to investing to save for a deposit and seeking outsized returns.” Webull’s Australian chief Rob Talevski added that clients remain focused on growth‑oriented US shares, even as capital‑gain taxes rise.

The Property Investment Professionals of Australia warned the reforms could shift focus to cash‑flow assets, increasing exposure to higher‑yielding but potentially riskier property types. Chair Cate Bakos noted, “Positive cash flow may appear more valuable now that first‑time investors no longer have access to negative‑gearing tax offsets unless they purchase brand‑new property,” and cautioned that cash flow alone does not build long‑term wealth.