Essay by Eric Worrall
Australia’s shock capital gains tax rises will apparently not negatively affect any part of the economy except renewables.
Wind and solar investors relieved after Greens and cross-bench win 10-year reprieve on new tax on renewables
Sophie Vorrath
Aug 20, 2026Federal Labor has moved to put more of a buffer between its reforms to Capital Gains Tax (CGT) and foreign investors in Australia’s renewable energy transition, adding another decade of breathing room before the full force of the new rules are applied to the sector.
News emerged from federal parliament on Thursday that the Albanese government had amended its legislation to extend a proposed CGT concession from 2030 to 2040 for foreign investors in renewables.
The CGT legislation, first introduced to federal Parliament in early July, had stopped short of making the reforms targeting foreign-owned wind, solar and battery assets retrospective, and had offered a 50 per cent discount on the tax for the next four years, to help soften the blow.
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“It’s the opposite of the message we want to send, which is that Australia is a stable predictable investment destination that respects the long term timeframes necessary for major energy infrastructure,” Richie Merzian, the CEO of the Clean Energy Investor Group, said at the time.
The new amendment to the Bill – which was pushed for by a mix of Green and independent cross-bench MPs – extends the timeframe for the 50 per cent CGT discount from its previous end-date of June 30, 2030, to 10 years later, on June 30, 2040.
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Read more: https://reneweconomy.com.au/wind-and-solar-investors-relieved-after-greens-and-cross-bench-win-10-year-reprieve-on-new-tax-on-renewables/
Despite accepting the need for a more competitive tax regime for renewables, at least for foreign investors, the Australian Government maintains their punitive treatment of risk taking investment profits as equivalent to wage income will not adversely affect investment in other industries.
Jim Chalmers defends impact of tax changes on young investors
By political reporter Holly Tregenza
Posted , updated…
Critics argue targeting CGT, which applies to all investments including new shares and crypto, limits one of the only wealth-growth avenues available for young people.
But Mr Chalmers said under the existing CGT settings, shares had been “under compensated” for two decades, arguing it was better for people to invest based on economic outcomes rather than tax outcomes.
“We’re taking one of the big distortions out of the market,” he told Insiders.
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Mr Chalmers said young people would still have the opportunity to utilise negative gearing to rentvest, if they were to purchase a newly built home.
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Read more: https://www.abc.net.au/news/2026-05-17/jim-chalmers-defends-impact-of-tax-changes-on-young-investors/106689268
This new carveout for renewables, on top of an existing carveout for new build homes, is a partial acknowledgement of the truth that Australia’s new capital gains tax rules are deterring investment in Australia, regardless of what the government tries to claim.
I doubt the tax concessions will lure investors back to Australian renewables, which are currently in a deep slump.
Part of the reason for this slump may be One Nation. The top people in One Nation, which is currently head and head with the ruling Labor Party in opinion polls, absolutely hate renewables. In my opinion if they win office there is a significant chance they will pass laws to tear up government renewable contracts and subsidies without compensation. This must be weighing on financing decisions for new Australian renewables projects.
