Originally published by John Kehoe of the Australian Financial Review.
15.04.2026
Treasurer Jim Chalmers has shocked foreign investors in local mining, energy and infrastructure by imposing a retrospective capital gains tax dating back 20 years to raise billions of dollars for the federal budget, sparking warnings he is discouraging future investment in Australia.
Chalmers is seeking to pass laws that will override two Federal Court rulings that went against the Australian Taxation Office last year, finding that North American mining giant Newmont and Malaysian conglomerate YTL Power did not have to pay tax on the sale of some Australian assets. The legislative move will affect dozens of other past transactions.
In the lead-up to the May 12 federal budget, Chalmers is trying to bolster the government’s revenue as he faces a decade of budget deficits and debt that Treasury forecasts will exceed $1 trillion this year.
The surprise retrospective capital gains tax hit jars with other moves by Chalmers to boost investment in Australia, including the consideration of tax incentives for business, faster foreign investment screening and an “investor front door” to streamline environmental and regulatory approvals for designated projects.
John de Wijn, KC, who represented Newmont and YTL in their court victories against the ATO, said it was “outrageous” that Chalmers was seeking to change the rules with retrospective effect to December 12, 2006.
“The retrospective amendments will, if passed, broaden the tax base for foreign investors very significantly and change the rules well after the final siren,” de Wijn said.
“All taxpayers are entitled to know the rules that will apply to them, especially when they make decisions about serious investments in Australian infrastructure.”
Chalmers on Friday announced the broadening of a 30 per cent capital gains tax on foreign investors selling property-related assets in Australia, including renewable energy, telecommunications infrastructure, rail, ports and airports, heavy machines used in mining such as drills and crushers, and water entitlements.
The move had previously been flagged as a prospective change affecting future asset sales, but foreign investors and their advisers are stunned that Chalmers is now proposing that the law change apply to transactions dating back to 2006. The government has given stakeholders two weeks to respond to the draft legislation.
Newmont and YTL were contacted for comment on Tuesday.
Tax advisers said billions of dollars more were at stake from foreign investor asset sales over the past 20 years, with dozens and potentially hundreds of businesses facing the prospect of large tax bills being issued by the ATO.
Jenny Wong, Australia tax lead at accounting body CPA, said the government’s proposed tax amendments went well beyond clarification and amounted to a material policy shift.
“Reaching back almost 20 years to reopen settled transactions is deeply problematic,” Wong said. “Applying new interpretations of the law back to 2006 sends a clear signal that the rules can change after the fact, and that makes Australia a less attractive place to invest.”
