Greens promise to waive through sensible tax reforms
The Australian Greens have promised to waive through various tax reforms impacting superannuation and property investment, in a bid to boost budget revenue and improve equity.
After months of pushing for amendments, the Greens have agreed to pass the extra 15% tax on earnings from super balances above $3 million without changes (i.e., Division 296).
Following earlier negotiations, Labor softened the original proposal. The $3 million threshold will now be indexed to inflation. The tax will only apply to realised gains, not unrealised gains.
The proposal will levy an additional 15 percentage points of tax on earnings above $3 million (up to a total of 30% tax). There will also be a new $10 million tier, with an extra 25 percentage points of tax (up to 40% total tax).
To sweeten the deal, the low‑income tax offset will also be increased, thereby increasing superannuation savings for lower-income Australians.
The Greens’ treasury spokesman Nick McKim framed the party’s support as a “down payment” on broader tax reform. He also signalled openness to reducing the 50% capital gains tax (CGT) discount, changes to negative gearing, and higher taxes on trusts.
McKim said Labor now has “an open goal” to pursue progressive tax changes.
“We are going to support the bill as a down payment on genuine, progressive tax reform in this budget”, McKim said in a statement.
“This budget is a once-in-a-generation opportunity for ambitious tax reform, and we are opening the door for Labor to walk through”.
“Labor is standing in front of an open goal – if they bring reform that would rein in spiralling inequality and the housing crisis, they will have the Greens’ support to get it done. The only obstacle to real change is Labor”, McKim said.
It is great to see the Greens finally take a constructive, enabling stance on meaningful tax reform, rather than their usual role as blockers.
There are strong arguments for reforming superannuation concessions on large balances, the CGT discount, negative gearing, and the taxation of trusts on budget sustainability and equity grounds.
My only hope is that the Albanese government pairs reform in these areas with reductions in personal income taxes.
As noted by Westpac’s chief economist, Luci Ellis, almost all the savings Australians received from the Albanese government’s stage three tax cuts have been wiped out as taxation as a share of household income surged throughout 2025 to 48% of total budget revenue.
“This is again a material drag on household disposable incomes and spending”, Ellis said.
“Given that many Australian households are very lightly taxed, a rising tax burden on the rest has distributional implications”.
The government should use the extra tax revenue raised via reform in the above areas to either lower marginal tax rates or raise the thresholds.
