Portfolio — 19 May 2026

Assistant Treasurer Daniel Mulino used a 19 May media release to explain the design logic of the government's capital gains tax overhaul — the most significant structural change to the CGT regime since the Howard-era 50 percent discount was introduced in 1999 [TA-260519-treasu-096cdb17354f]. The reforms replace that flat discount with inflation indexation across all asset classes, including shares, so that only real gains are taxed rather than the inflationary component of an asset's appreciation.

Mulino's central argument is that the 1999 discount produced cross-asset distortions: it over-compensated shareholders relative to property holders, and the new design corrects that asymmetry by applying a single, consistent indexation principle regardless of asset type. To support the rate-setting decision, Mulino cited Treasury analysis released the same day showing the effective CGT rate for top-bracket taxpayers lands in the mid-30s percent — a figure he positioned as comparable to many European jurisdictions and below the United States rate.

The international benchmarking is a deliberate framing move, placing the reform inside a band of accepted norms rather than at an outlier position. One unresolved tension the release acknowledges is the start-up sector's exposure to low cost bases, where inflation indexation could produce larger nominal tax liabilities on early-stage equity. Mulino confirmed Treasury will open consultation with that sector, consistent with a commitment the Treasurer flagged on Budget Day, though no timeline or process detail was provided in this release.

The portfolio's stated objective is equity across asset classes — removing what Mulino characterised as arbitrary discounts and reducing distortions that have shaped investment allocation for over two decades.