CPA Australia has cautiously endorsed the government’s ongoing Tranche 3 tax reform consultation.
However, the accounting body warned of major uncertainty, complexity and compliance costs for small businesses, taxpayers and advisers as details “continue to trickle out”.
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CPA Australia Tax lead Jenny Wong explained that the latest consultation includes some practical measures and elements of compliance relief.
However, she stressed that these are just one component of a broader reform programme that will significantly reshape Australia’s property and capital gains tax framework.
Wong said: “We are now dealing with the most significant overhaul of property and capital gains tax in a generation, and complexity and compliance cost remain the central issue for taxpayers and their advisers.”
She said small businesses in particular require certainty and simplicity, rather than an expanding set of “highly technical and overlapping reforms”.
Wong added: “The government has rightly identified productivity and reducing red tape as national priorities.
“These reforms will ultimately be judged by whether they make life easier or harder for the millions of Australians trying to run businesses, invest and comply with their tax obligations.”
CPA Australia warned that unsettled details ahead of the 1 July 2027 start date already pressure taxpayers and accountants.
The body also added that it supports the policy intent behind the proposed capital gains tax apportionment method for affected assets as an alternative to formal valuations.
However, Wong warned the approach could still lead to outcomes that do not accurately track how an asset’s value has changed over time.
CPA Australia has also urged the Australian Taxation Office (ATO) to publish calculators, guidance and record-keeping requirements well before the reforms commence.
The organisation has welcomed a change extending the period during which a dwelling can be treated as “new” from 12 to 24 months, calling it a practical step that better aligns with how developments are constructed and sold.
At the same time, CPA Australia is worried that the associated anti-avoidance provision could unintentionally catch legitimate commercial activity.
The organisation also shared its concerns about the combined effect of budget tax measures targeting capital gains tax, negative gearing and discretionary trusts.
