Despite efforts to manage expectations publicly, there is growing momentum behind potential wealth-related tax changes shaping Labor’s economic roundtable. Key submissions suggest emerging consensus around reforms to superannuation and property taxation, areas where the government may act without triggering immediate political resistance.
This discussion follows the recent rollout of the Division 296 super tax, which applies an additional 15% tax on earnings above $3 million in superannuation. Introduced during the last election, this measure provides a framework for further adjustments to wealth taxation, with the government buoyed by the successful implementation. Summit contributors range from major social services organisations to Australia's largest banks, many of whom argue the current system unfairly benefits older, wealthier Australians.
One area gaining attention is the capital gains tax discount. Currently, investors pay tax on only half of any capital gain if the asset is held for more than a year. As property prices rise rapidly, policymakers from across the spectrum are reconsidering whether this arrangement remains equitable, especially when viewed alongside stagnant rents and reduced housing affordability for younger Australians.
The aged pension is also under review, in particular the ongoing exclusion of the family home from the assets test. Some expect these rules to be quietly adjusted, potentially through lower asset thresholds or updates to the deeming rate. This rate estimates returns on savings and has remained unchanged despite rising interest rates.
While controversial proposals such as ending negative gearing or altering rules on franked dividends remain politically sensitive, they remain in play. Pressure is mounting to limit negative gearing, which allows property investors to offset rental losses against taxable income. As house prices continue to rise faster than wages, critics say the policy increasingly disadvantages younger buyers struggling to access the housing market.
The government is also likely to review tax arrangements for family trusts. These structures are gaining popularity among wealthy individuals responding to recent superannuation changes. Unlike super accounts, trusts tax only realised gains, not unrealised ones, and offer more flexibility. This has brought them into focus for policymakers reassessing how they are treated under the tax system.
Nothing has been finalised, but the direction is evident. The summit is set to propose changes aimed at reshaping the tax system in response to calls for greater economic fairness in a shifting national landscape.
