Jason Fielding
1.2K posts
@JasonFielding
Voice Capital Co-founder - Science & Culture. Make Australia a serious country again with serious ambitions. All things Bitcoin.
Tax on investment gains 🇳🇿 NZ: 0% 🇸🇬 Singapore: 0% 🇨🇦 Canada: 27% max 🇬🇧 UK: 20% – 24% max 🇺🇸 US: 20% max 🇮🇱 Israel: 25% (Standard) ❌❌ 🇦🇺 Australia: 30% - 47% Labor’s new minimum capital gains tax is HIGHER than the max in most nations. Higher taxes = less investment.
Labor’s new capital gains tax of up to 46% to 47%, which is far and away the highest in the world, hammers all businesses, including small companies, harder the more successful they become. By applying the most expensive CGT regime in the world, Labor is taking almost half of the upside of any successful firm, encouraging owners and executives who own shares in the business to look at relocating overseas. The question, however, is how many small businesses will actually pay this tax in practice. We prepared the following simulation to highlight the impact. We took the long-term 20 year returns from Cambridge Associates for smaller venture capital companies, which grow by 12.2% pa. We adopted the ASX equity market volatility of 15% pa, which would understate the true volatility of small firms (and thus lead to a lower proportion of very high growth companies paying 46-47% tax in our analysis). We then ran a simulation to estimate the proportion of businesses paying CGT of more than 40%. We find that within 10 years more than half of all Aussie small businesses will be hammered by CGT over 40%, which rises to 78% of all small businesses by 20 years... By giving Australia the most uncompetitive business valuation tax in the world, this policy will crush innovation, entrepreneurship, spending, productivity, growth and our global competitiveness. We already have among the lowest productivity growth rates in the world: by reducing productivity further, we could raise the cost of living, inflation, and interest rates.
⚠️The RBA will need to raise rates in June into an energy crisis and property crash. Australia is being swept up in the global bond market sell-off. Central banks can either save the bond market (and with it the property market), or the currency. They cannot save both. The Australian economy is about to fall off a cliff.
A US Senator just casually explained how you can store BTC in your brain during a legislation markup: "It provides people who are being tortured in foreign countries the opportunity to walk away with their money in their head. Because Bitcoin can be memorized." Magic ✨
How do we make Australia more prosperous? How do we encourage people to build businesses, take risks and compete with the rest of the world? Our politicians and government are spending the money that comes from our work, our risk and our effort. So we should demand more from them. More innovation. More ambition. More bold decisions. As Australians, we should expect to have one of the highest standards of living in the world. Let’s demand this from the people who lead us.
