INFORMATION FOR SECTORS

The 2026–27 Budget, delivered amid ongoing economic uncertainty and significant tax reform, has broad implications across Australia’s key industries. 

For the health, agribusiness, and property and construction sectors, the measures signal a renewed focus on resilience, productivity, workforce pressures and long-term investment, alongside targeted relief designed to support businesses navigating a rapidly changing economic landscape.

The agricultural sector is heading toward complexity and additional tax costs as tax reform will reshape the landscape for business structuring and intergenerational transfer of wealth via family trusts.

Taxation of family trusts
Family trusts remain a core structure across the agricultural sector. Under the 2026-27 Budget, a minimum 30% tax on trust income will apply from 1 July 2028, with a carve-out for primary production income. However, many agricultural groups utilise multiple landholding trusts for asset protection and succession planning purposes. Where these trusts lease property to related trading entities, net rental income will be taxed at 30%, reducing the efficiency of these structures and increasing overall tax exposure on inter-entity arrangements.

Loss carry back for corporate structures
Agricultural businesses operating through companies will benefit from the reintroduced loss carry back measures. Losses incurred in the 2026-27 income year can be carried back up to two years earlier, to generate refunds of tax previously paid. This delivers a direct cash flow benefit during downturns and helps offset the impact of seasonal volatility, including drought and commodity price movements. The measure improves financial resilience for corporatised agricultural businesses.

Impact on succession planning
Succession planning has historically relied on family trusts due to their flexibility in separating ownership, management and control. Increased taxation on trust income is likely to disproportionately affect agricultural businesses that are asset rich but cash flow constrained. This may limit flexibility and increase tax exposure when transitioning high-value farmland to the next generation, adding complexity to established succession strategies.

Cost base reset for pre-CGT farmland
Farmland acquired prior to 20 September 1985 will have its cost base reset to market value at 30 June 2027. This exposes future capital growth to CGT from the 2027-28 income year. Although the reset provides certainty over historic value, it materially alters succession planning considerations, particularly regarding ownership structures, timing of transfers, and management of future gains.

Fuel and fertiliser security package
A multi-billion fuel and fertiliser security package is designed to strengthen domestic supply chains and reduce reliance on volatile global markets. In an environment of heightened geopolitical instability, this reduces exposure to supply disruptions and input cost volatility, which are significant drivers of farm profitability.

The package will be delivered through government-backed financing, expanded fuel reserves, and investment in storage and distribution infrastructure. These initiatives are expected to improve availability and reliability of supply, particularly during peak production periods. Increased supply chain resilience provides greater certainty that critical inputs will be available when required, reducing operational risk for agricultural businesses.

Read more about impacts for the agribusiness sector.

In primary care, the Government has confirmed $1.8bn over five years, plus $580.2m ongoing annually, to make all 137 Medicare Urgent Care Clinics permanent. While this should ease pressure on emergency departments, it may also intensify workforce pressures in general practice. The Budget also includes $2.1bn over five years to strengthen Medicare and improve access to affordable primary and specialist care, alongside $25.3m for up to six new fully bulk-billing GP clinics in targeted regions.

Additional measures affecting medical practices include $745.1m for Medicare integrity and digital health infrastructure, including $598.3m for My Health Record and the new Sharing by Default reforms from 1 July 2026. These initiatives are likely to increase billing scrutiny and strengthen expectations around clinical information sharing. At the same time, the Budget introduces savings measures, including $43.4m from capping the Extended Medicare Safety Net and $3bn in savings from removing the age-based uplift to the Private Health Insurance Rebate from 1 April 2027, which may shift further demand onto the public system.

In aged care, the Budget provides $3.7bn overall, including funding for regulation, workforce capability, ICT, residential bed supply, dementia supports and home care reform. This reflects a continued focus on expanding access and improving service quality for older Australians.

The Budget also signals a structural reset of the NDIS, with $1.7bn over five years for integrity, fraud prevention, payment reform and provider regulation, alongside a projected reduction in NDIS growth of $37.8bn. Reforms include tighter eligibility, narrower definitions of funded supports, increased provider registration and commissioning reforms. While these changes aim to improve scheme sustainability, they create uncertainty for participants and significant adjustment pressures for providers, particularly those without strong governance, systems and financial resilience.

Read more about impacts for the health sector.

Previously, the Government has set a goal of building 1.2 million homes over five years from 1 July 2024. Currently, the nation may be up to 100,000 homes behind target and it is in this context that the Budget has been constructed.

The centrepiece of the Government’s home building agenda in the 2026-27 Budget is the establishment of a $2bn investment fund, designed to accelerate the delivery of 65,000 new homes nationwide through the funding of infrastructure, such as roads and utilities, to open up new lots.

For those in industry, the Government is providing the following support:

• $75.1m over four years for a new, modern skills assessment for Trades Recognition Australia to facilitate the integration of occupational licensing, including in priority trades such as electricians and plumbers.
• $105.9m over four years to modernise environmental information, data and digital systems (including AI) to improve user experience and enable simpler and faster environmental approvals for infrastructure projects.
• $26.4m over four years to work with states and territories to fast-track environmental approvals in priority areas including housing.
• $42.7m over four years to provide Standards Australia with ongoing grants to provide free public read-only access to standards referenced in Commonwealth and State and Territory legislation. This measure is stated as saving small businesses and tradies up to $1,600 per year.
• Abolishing 457 nuisance tariffs, including some inputs into the construction industry, with effect from 1 July 2026.

Whilst much of the attention is focused on the impacts of the proposed changes to negative gearing and capital gains tax discounts, investors in new residential properties will have preferential treatment from 1 July 2027, retaining negative gearing as well as access to the 50% CGT discount. The Government considers that these changes will support an estimated 75,000 homeowners over the next decade.

Lastly, bans on foreign investors purchasing established homes have been extended until mid-2029, meaning that any foreign investment will need to be directed toward new dwellings.

For those providers of infrastructure projects, the Government states that it is maintaining a rolling infrastructure pipeline of more than $120bn over 10 years, including $8.6bn for new and ongoing projects of national significance. The largest new investment is $3.8bn directed towards Victoria’s Suburban Rail Loop East, enabling more transport and homes in the right places and reducing congestion, with a further $1.75bn in equity for the Australian Rail Track Corporation to upgrade Australia’s rail freight network. 

Read more about impacts for the Real Estate and Construction sector.

The funding announcements in the 2026-27 Budget will significantly constrain Australia’s innovation funding landscape by reallocating and reducing support across agriculture, research, clean energy and industry programs, and will create a more competitive and uncertain environment for innovators.

Agricultural innovation is notably affected, with uncommitted funds from several grant programs redirected elsewhere within the Agriculture, Fisheries and Forestry portfolio. The Future Drought Fund faces the largest reduction, with $52m cut over four years from 2026–27 and an additional $13m per year ongoing. Whilst existing contracts are expected to continue, future drought resilience initiatives will have reduced support. Further funding cuts will affect a range of grant programs and other trade and innovation initiatives, totalling $104.6m in savings over five years. As a result, future grant rounds are likely to be fewer, smaller and more competitive, with tighter eligibility criteria.

In research and innovation, the Budget seeks to reshape rather than expand funding. The Medical Research Future Fund (MRFF) receives a planned uplift of $508.5m over four years, with annual funding growing to $1bn by 2030-31. However, access to this funding is delayed because allocations will remain in the Contingency Reserve until the National Health and Medical Research Strategy is finalised, creating uncertainty for applicants. This increase comes at the expense of the Australia’s Economic Accelerator (AEA) program. The program represented a major source of support for university-industry collaboration and research commercialisation.

Clean energy innovation funding is also reduced. Key programs administered by Australian Renewable Energy Agency (ARENA), including the Battery Breakthrough Initiative, Solar Sunshot, and Hydrogen Headstart Round 2, will lose funding, resulting in $1.3bn in cuts over ten years from 2026-27. These programs were originally part of the Future Made in Australia package aimed at strengthening domestic renewable manufacturing and accelerating decarbonisation. The reductions suggest a recalibration of clean energy industry support and lower-than-expected uptake.

Finally, multi-sector industry innovation faces reduced support, with $266.2m cut over five years from grant programs administered by the Department of Industry, Science and Resources (DISR). This implies a smaller grant pipeline and heightened competition across priority sectors.

Read more about impacts for the Innovation, Clean energy and Technology sector.