Tax experts are concerned about the federal government’s proposal to abolish the capital gains tax (CGT) exemption for expatriates who sell their main residence in Australia. They have warned that the proposed reforms could potentially apply retrospectively from 1985, when CGT was introduced. Shadow treasurer Chris Bowen has also expressed concern about the “unintended consequences” of the proposed reforms, which were announced in the May 2017 Budget as part of the government’s strategy to address the issue of housing affordability. From The AFR:
“The proposed changes are draconian and retrospective because while the bill is proposing the measures will apply to CGT events that happen after May 9, 2017, it has the practical effect of denying the main residence exemption back to when people originally bought the property,” said Ms Jacobson, a senior trainer at TaxBanter.
