Greens back Labor's tax changes in deal to delay NDIS overhaul

The Greens will support the Albanese government’s negative gearing and capital gains tax changes under a deal that will delay and tweak Labor’s planned overhaul of the national disability insurance scheme.

The minor party announced its position on Tuesday morning, clearing the path for Labor to pass its contentious budget centrepiece before federal parliament rises for the winter break.

The Greens resolved to support the tax bills after the government agreed to remove a loophole allowing investors with self-managed super funds to continue taking advantage of the tax breaks, along with ministerial powers enabling the government to reverse the reforms in the future.

In a joint statement, the prime minister, the treasurer and the finance minister noted the Greens’ announcement.

“The Albanese government is another step closer to delivering its tax reforms for workers, home buyers, and businesses,” they said. “These reforms will make it easier for Australians to buy their first home, cut taxes for over 13 million workers, and better align the tax treatment of labour and asset income.”

As part of negotiations with Labor, the Greens say they have secured an eight-week extension to a Senate inquiry into the NDIS changes and negotiated several amendments, including to limit the scope of the minister’s powers to make blanket cuts to categories of participant supports.

The minor party will still vote against the legislation, which it considers “cruel” and harmful to the more than 240,000 people expected to be forced off the disability scheme under the drastic cost-saving plan.

The government last week announced several changes to its capital gains tax proposal, including winding back the treasurer’s discretionary powers to allay one of the Greens’ major concerns.

Under the proposed changes, the capital gains tax discount of 50% on profit made from sold assets would be changed to a cost-based indexation model from July 2027.

Negative gearing concessions would also no longer apply to investment properties bought after 7.30pm on 12 May 2026, with exceptions for new builds and some government housing programs open to investors.

The findings of a Senate inquiry into legislation to contain the ballooning cost of the NDIS were scheduled to be tabled on Tuesday, after being delayed twice last week.

Guardian Australia has been told the inquiry will now be extended until 14 August, allowing extra time for further public hearings and consideration of the thousands of submissions presented to senators.

The committee heard widespread concerns from disability advocates, providers and the states and territories about Labor’s drastic plan to save $37.8bn over four years, including by tightening eligibility criteria and subjecting all participants to independent functional assessments.

The legislation would also give the minister power to cut entire categories of support, which the health minister, Mark Butler, intends to use to slash the stream of funding that participants use to hire support workers to allow them to engage with the community.

The Greens’ disability spokesperson, Jordon Steele-John, has negotiated an amendment that will shield other categories of support from that power, including funding allocated for daily living, assisted technology, consumables and home modifications.

Supports that people rely on for daily health needs, attending medical appointments or getting to work would also be protected.

The minor party has also secured guarantees that people would not have to subject themselves to restrictive practices – such as forced medication – to meet the new requirement that all treatment options are exhausted before they can access the NDIS.

The potential deals between Labor and the Greens will infuriate the Coalition, which offered to work with the minor party to extend the NDIS inquiry for six months in exchange for more scrutiny of the tax bills.

The government will need the opposition’s support to pass the NDIS after the inquiry publishes its findings in mid-August.

Butler has been contacted for comment.

More details soon …