The Australian Council of Trade Unions (ACTU) has unveiled a bold set of proposals aimed at enhancing living standards in Australia. Among the key recommendations is a plan to restrict negative gearing to a single property and impose a minimum tax rate of at least 25 percent on millionaires and family trusts. The proposals are part of a submission to the Albanese government for a three-day economic roundtable, where the ACTU will occupy two seats.
The ACTU claims that these reforms could generate up to $25 billion in revenue, which could be reinvested into essential services, including the National Disability Insurance Scheme and healthcare. The union’s agenda also suggests accelerating building approvals for various projects, from residential housing to large energy initiatives.
Despite these ambitious proposals, the ACTU’s agenda may face significant opposition. Just days prior, the business community largely rejected a suggestion from the Productivity Commission to reduce the company tax rate while simultaneously introducing a unique cashflow tax. ACTU National Secretary Sally McManus acknowledged the challenges ahead but emphasized the urgent need for reforms to address the escalating housing crisis affecting younger Australians.
According to McManus, the stagnation of wage growth in relation to productivity has exacerbated the financial struggles of many workers. She criticized businesses for prioritizing profits through share buybacks, dividends, and bonuses, leaving little for employees. “One of the reasons that productivity has slowed in Australia is that companies have directed profits into share buybacks, into dividends to shareholders and into bonuses,” she stated.
Under the proposed reforms, negative gearing and the 50 percent capital gains tax concession would be limited to a single residential property. Existing investors would be exempt from these changes for five years, allowing them to adjust to the new regulations.
The ACTU’s recommendations reflect a growing concern about the affordability of housing in Australia. With many young people struggling to enter the property market, McManus asserted that any discussion surrounding productivity must prioritize the living standards of all Australians. The union’s proposals set the stage for a contentious debate on taxation and economic reform in the coming weeks.
