Australia Plans to Reduce Capital Gains Tax Discount, Potentially Impacting Long-Term Holders of Digital Assets

Odaily Planet Daily News: Australian authorities plan to revise the capital gains tax system in the upcoming federal budget, with adjustments covering cryptocurrencies and other digital assets. Currently, the Australian Taxation Office treats most cryptocurrencies as capital gains tax assets, allowing individual investors who hold them for more than 12 months to enjoy a 50% reduction in taxable gains.

According to reports, the government is currently considering reducing the 50% discount to between 25% and 33%, or replacing the fixed discount with an inflation-indexed method, where tax is only levied on the actual appreciation exceeding inflation. This reform applies to stocks, exchange-traded funds, and digital currencies held outside of pension accounts. Analysis indicates that the new rules could reduce the after-tax returns of high-growth tokens and prompt retail investors to adjust their portfolios before the policy potentially takes effect on July 1, 2026. Specific details are still pending confirmation in the Finance Minister's budget report.