Economic Reform Roundtable 19.8.2025 to 21.8.2025

Submission by Geoff Nunn

Disclaimer:  the comments and opinions expressed on this page are the personal views of the author, Geoff Nunn, and do not represent professional advice.

 

Treasurer Dr. Jim Chalmers

Economic Reform Roundtable 19.8.2025 to 21.8.2025

The Treasurer, Jim Chalmers, has convened a three day roundtable of business leaders, union representatives, subject matter experts, and government officials to address issues of national productivity and to pursue initiatives aimed at securing our economic well being. This roundtable will follow five pillars which are the subject of current Productivity Commission inquiries:

  1. Creating a more dynamic and resilient economy.

  2. Investing in the net zero transformation.

  3. Building a skilled and adaptable workforce.

  4. Harnessing data and digital technology.

  5. Delivering quality care more efficiently.

To support this initiative Geoff Nunn has made a submission which will focuses on Pillar 1 above. Firstly the need to rationalise regulation and compliance requirements on business, government and community organisations of all types. Secondly to address the need for Tax Reform and in particular the impact of negative gearing and capital gains tax concessions on housing affordability and homelessness. I’ve included some key points here and a link to the Submission.

Regulation and Compliance

The burden of compliance, regulation and reporting across all sectors of the economy is enormous and detrimental to national productivity. 

We need sound regulation to “keep the bastards hones”t, maintain governance standards and ensure public monies are appropriately spent.  But when regulation and compliance absorb substantial people and financial resources, which would be better focused on the organisation’s core purpose, it’s time for review and rationalisation. 

There is a case for a broader multi-level inquiry with a mandate to rationalise and simplify compliance requirements.  This needs to involve all levels of government and input from all industry sectors. 

Tax Reform

(a)    Negative Gearing.  In a well thought out and structured paper on the need for tax reform, the Member for Wentworth, Allegra Spender, addresses the issue of “Housing Affordability” and notes that over the last 25 years housing prices have increase four times whereas the average income has only two times.[1]  This has effectively placed the capacity to purchase a house beyond the reach of many.  Negative gearing makes investment in residential property very attractive from a wealth accumulation point of view. 

(b)    Capital Gains Tax (CGT) on Investment Properties.  The CGT discount on proceeds from the sale of an investment property (held for more than 12 months) is 50%.  Meaning that only 50% of the capital gain is regarded as assessable income.  Again, this makes investment in residential property very attractive.  Demand fuels the market thus pushing prices out of the reach of many Australians. 

It’s time to launch another full-blown review of Australia’s overly complex and distorted tax system.  Negative Gearing and Capital Gains Tax need to be firmly in the agenda.  The Henry Report of 2010 is not a bad starting place and Allegra Spender’s idea of establishing a Tax Reform Commission has considerable merit. 

[1]  Allegra Spender MP for Wentworth.  Tax Green Paper.  November 2024.

The Submission can be viewed here:

Economic Reform Roundtable, Submission by Geoff Nunn