Why are the Australian Greens demanding changes to self-managed superannuation funds?

The Australian Greens demand a ban on self-managed superannuation funds, or SMSFs, from borrowing to buy residential property to close a perceived tax loophole before passing the federal budget.

What is the financial size of the delayed government savings bill mentioned in the budget negotiations?

The federal government agreed to delay its A$37.8 billion National Disability Insurance Scheme, or NDIS, savings bill until August to secure separate support from the Australian Greens.

How do limited recourse borrowing arrangements impact self-managed superannuation funds?

Limited recourse borrowing arrangements, or LRBAs, allow an SMSF to purchase debt-funded assets by ensuring a lender can only repossess the specific property if the borrower defaults.

What specific change did the federal government make to its small business capital gains tax policy?

The federal government lifted the small business turnover threshold for an extra 50% capital gains tax discount from A$2 million to A$10 million. This policy alteration was part of a raft of changes made by the government in response to concerns raised by the business community.

What is the position of the SMSF Association regarding the proposed borrowing ban?

SMSF Association Chief Executive Peter Burgess stated that SMSFs should not be used as a political football to address perceived federal budget risks.

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Greens demand SMSF property borrowing ban

Written by Mahathir BayenaPublished Jun 22, 2026, 10:01 PM

The Australian Greens demand a ban on self-managed superannuation fund borrowing to support the federal budget.
The potential policy shift could impact property investments made via limited recourse borrowing arrangements.
The minor party aims to close a perceived tax loophole before passing the government's budget legislation.

The Australian Greens have demanded that the federal government ban self-managed superannuation funds from borrowing to purchase residential property in exchange for the minor party's crucial Senate budget vote.

This development follows the government's recent decision to delay its A$37.8 billion National Disability Insurance Scheme savings bill until August to secure separate Greens support.

"SMSFs should not be used as a political football to address perceived federal budget risks," said SMSF Association CEO Peter Burgess.

The minor party stated that the restriction is necessary to prevent a surge in tax-sheltered property investments following the government's broader capital gains tax changes.

The government is currently negotiating the terms to ensure the passage of its budget bill by the end of next week.

The proposed ban targets limited recourse borrowing arrangements, which allow superannuation funds to purchase debt-funded assets while protecting other fund holdings from loan defaults.

The federal government previously altered its budget tax policy by lifting the small business capital gains tax discount turnover threshold from $2 million to $10 million.