Why are tech leaders like Canva's Cliff Obrecht opposing the CGT changes?

Tech leaders argue that moving to an inflation indexation model will crush high-risk investment and cap innovation in Australia. Canva co-founder Cliff Obrecht stated the policy is short-sighted and risks killing off the next generation of major Australian tech success stories before they can properly scale.

How does the proposed inflation indexation model handle investment gains and losses?

Under Treasurer Jim Chalmers' proposed model, the tax system will compensate investors for inflation on their gains, but it will not treat real profits and losses evenly. Investors will be allowed to deduct nominal losses (where an asset drops below its purchase price), but they cannot offset real inflationary losses against real gains.

Why are economists calling the lack of real loss offsets a design flaw?

Economists warn that failing to treat the upside and downside of investments symmetrically betrays core tax principles and creates severe market distortions. By refusing to allow real inflationary losses to be offset against real gains, the policy actively penalises risk-taking and portfolio diversification.

How will the new CGT rules affect diversified retail portfolios in Australia?

Analysis by former Treasury official Geoff Francis shows that a typical diversified portfolio, where one-third of shares underperform inflation, could face real effective CGT rates between 42 per cent and 65 per cent. This structure severely punishes retail investors who spread their risk across multiple individual assets.

What types of ASX stocks face the highest risk under the new CGT policy?

Volatile, high-growth sectors like technology, biotechnology, and mining exploration companies are highly vulnerable under this policy. Because these sectors frequently experience big swings and high asset failure rates, the inability to offset real inflationary losses makes backing individual early-stage companies far more expensive.

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Tech and economists unite against CGT overhaul

Q: What is the Albanese government's proposed Capital Gains Tax overhaul in Australia?

The Australian federal government plans to replace the existing 50 per cent Capital Gains Tax (CGT) discount with an inflation indexation model. The proposed legislation, which also limits negative gearing to existing properties and new builds, aims to raise 3.6 billion dollars over four years.

Written by Mahathir BayenaPublished May. 26 2026Last Updated May. 26 2026

Australia’s tech sector and leading economists have unified in a major pushback against the Albanese government’s proposed capital gains tax overhaul, warning the changes will stifle innovation and penalise everyday investors.

The backlash intensifies as draft laws head to parliament this week. Tech heavyweights, including Canva co-founder Cliff Obrecht and NextDC CEO Craig Scroggie, argue that replacing the 50% CGT discount with an inflation indexation model will crush high-risk investment.

"It’s very short-sighted to cap innovation and kill the next generation of Canvas or Atlassians with short-term policy," Obrecht stated at a Commonwealth Bank conference.

The peak body of dissent includes economists who conceptually support the overhaul but warn of severe design flaws.

Under Treasurer Jim Chalmers’ proposed model, nominal losses can be deducted, but real inflationary losses cannot be offset against real gains.

Former Treasury official Geoff Francis revealed this asymmetry could leave diversified portfolios facing real effective tax rates between 42% and 65%, severely punishing investors who back volatile biotech, technology, and mining exploration companies.

Stockbrokers also warn the policy will drive retail investors away from individual shares and initial public offerings into passive ETFs.

While the government aims to ram the legislation through before the July winter recess with Greens support, Prime Minister Anthony Albanese indicated potential concessions, suggesting the government may exempt more small businesses beyond those with revenue under $2 million.

Treasury forecasts the combined housing and CGT changes will net $3.6 billion over four years.