Changes to the capital gains tax discount and negative gearing will be made law this week after the Government did a deal with the Greens to fast-track the controversial Budget changes.

The minor party’s support was won in exchange for Labor limiting self-managed superannuation funds from buying residential property.

It means the Government will get the bulk of its Budget tax package in place by Thursday.

But the Greens have also insisted on delaying to at least August the NDIS cuts the Government had sought to pass this fortnight, at a cost of several hundred million dollars.

Leader Larissa Waters said that, on balance, the tax package “is a small step in the right direction”, but her party would fight at every step to stop the multibillion-dollar NDIS cuts.

Prime Minister Anthony Albanese said the deal reflected the realities of having to get legislation passed through the Senate, a sentiment echoed by Treasurer Jim Chalmers and Health Minister Mark Butler.

“I expect that, just as the three right wing parties have opposed every one of our tax cuts, every pay rise for workers, every cost of living measure, every policy to build more homes and help more people buy a first home, they will oppose these measures and continue in their race to the bottom to see who can be more anti-aspirational, more anti-worker,” he told reporters.

Later, he said his approach had always been that where people were prepared to engage in constructive discussion, he would do so, and pointed to his record of having battled the Greens within his electorate for 30 years.

A fiery Question Time was laced with Gen Z slang as the PM labelled Opposition Leader Angus Taylor the “chief yapper” who was surprised “that we have spoken to other people in the Senate, besides Labor senators … in order to secure support”.

Shadow minister Dan Tehan shot back: “The Prime Minister is taxmaxxing with the Greens.’

Ministers hope a swift process on passing the tax changes will dampen noisy opposition that Mr Albanese labelled “self-interest” over the weekend and Dr Chalmers has slammed as a campaign of lies.

The tax package replaces the 50 per cent capital gains tax discount with one based on inflation, and imposes a minimum 30 per cent rate on the taxable portion.

It also limits negative gearing for properties bought since May 12 to new builds only, and sets up a $250 working Australians tax offset and $1000 standard deduction.

Last week, Mr Albanese and Dr Chalmers announced some back downs, including limiting the level of ministerial discretion to change elements of the package without returning to Parliament, which the Greens had complained went too far.

Greens economics spokesman Nick McKim laid out the rest of what the party wanted in his section of Friday’s report from the snap Senate inquiry into the tax bills.

It called for grandfathering of negative gearing limited to one investment property per person, and limits on the ability of self-managed superannuation funds to invest in the housing market.

The Government has agreed to the latter, with the Greens securing an amendment to remove exemptions that currently allow SMSFs to borrow money to buy residential property.

This change is expected to improve the Budget’s bottom line by $50 million over the next four years. SMSFs make up less than 1 per cent of residential property borrowing.

It didn’t give any ground on the negative gearing plan.

“What this will mean is that the major elements of our ambitious tax reforms will be in place once this passes both houses of Parliament,” Dr Chalmers said.

But shadow treasurer Tim Wilson said it looked like Labor had lost control of its budget.

He labelled the deal with the Greens “dodgy, dishonest and dangerous” while Mr Taylor said it was “rotten legislation”.

“We don’t know what’s in that deal. We do know, we do know this: that self-managed super funds are getting going to get hit,” Mr Taylor said.

A string of Coalition MPs asked the Prime Minister to rule out further agreeing to Greens demands to limit the grandfathering of negative gearing, abolish the diesel fuel rebate, and tax family homes (the last of which is not a Greens policy).

“In March last year, the Prime Minister said, ‘I don’t negotiate with the Greens.’ When will you stop lying?” Mr Taylor asked.

He earned the wrath of Speaker Milton Dick — accusations of lying have long been banned from the chamber — who said the Opposition Leader was “demeaning the dignity of this House” and warned he would be thrown out if it happened again.

A majority Australians are pessimistic about the country’s economic performance, according to the annual Lowy Institute poll released on Tuesday.

Its survey, taken in March before the Budget, found 59 per cent were gloomy about the state of the economy — a massive 12-point jump from last year, and higher than the level of pessimism during either COVID or the global financial crisis.

Industry groups warned the passage of the tax legislation would do little to ease this pessimism.

Master Builders Australia chief executive Denita Wawn said the construction sector was “deeply disappointed” by the deal with the Greens, which she warned would “be a hit to construction jobs, activity and housing supply, while driving up rents — an outcome not voted for by the Australian people”.

Mike Zorbas from the Property Council reiterated Treasury’s own modelling that the tax package would reduce the number of extra homes being built. The Government argues this is more than offset by its supply-side measures to boost infrastructure needed to make housing developments happen.

“When push comes to shove, Australia’s housing challenge is a supply challenge and these changes, added to the upcoming trust changes will deliver fewer homes, not more,” Mr Zorbas said.

A Senate inquiry into the NDIS legislation was supposed to hand down its twice-delayed report on Tuesday, but that has now been put off until August 14.

The Government has also agreed to make amendments the Greens say will “firewall” some areas of the scheme from further cuts.

But it will still have to turn to the Coalition to ultimately pass the changes aimed at saving upwards of $150 billion over the next decade.

“We will continue to work every step, every role, every vote, every motion, every time to oppose this bill, to have it shut back into the bin, and to get on with the work of building an NDIS that actually meets the community’s needs,” Greens disability spokesman Jordon Steele-John said.

Both the Government and the Greens painted this as a test for the Coalition.

“We handed down a budget in the context of, we know we have to get things through the Senate,” Mr Albanese said.

“We’ve had debates for a long period of time in this country calling for tax reform. When you see it, everyone who says that they need it, not everyone then comes on and says, ‘Okay, we need this change or this shift or this amendment’. Some of them just say no to everything.

“That’s not our approach. We work things through constructively. We’re confident that the NDIS reforms is also a test for Angus Taylor.”

Mr Taylor said he wanted to make sure the NDIS was financially sustainable, but when pushed on whether he could find a compromise to pass it, he would only say he wouldn’t do a deal on taxes.