Labor’s May Budget is still causing political headaches almost three months on with the Federal Government yet to fully resolve the problem of an unintended “widow’s tax”. Draft legislation released this week fixes a problem where grandfathering for negative gearing tax breaks and the 50 per cent capital gains tax discount on an investment property wasn’t carried through when ownership was transferred in the event of a death or divorce. “The issue is, like, it is still a widow tax. I’ve seen lots of people out there say, ‘Widow tax is fixed’ — no, it’s only half fixed. He’s already decided to roll back the widow’s tax, something that they could have done at the last sitting, but they chose not to,” she told reporters on Thursday.