By Andrew Mackinnon
Last updated: 4th May, 2023
Capital gains tax (CGT) in Australia constitutes less than 10% of all tax revenue collected in Australia by the Australian federal, state and territorial governments.
In fact, the percentage of total tax revenue collected that is attributable to capital gains tax is so small that I have not been able to find out what this percentage actually is on any Australian federal government website. The Australian federal government has deliberately concealed this information from Australian citizens and Australian entities.
The Australian federal government does not levy capital gains tax on Australian citizens and Australian entities because it needs tax revenue from capital gains tax. The Australian federal government levies capital gains tax on Australian citizens and Australian entities only because it does not want them to have the full capital gains to which they are legitimately entitled. Capital gains should not be taxed under any circumstances.
Capital gains tax is in direct opposition to property rights and should be abolished. With capital gains tax in force, if somebody saves up some money and then invests it in shares (or any asset), they quite obviously don’t have full property rights to the asset they purchase, because if they later sell this asset for more than they paid for it, the government wants a cut of the capital gain via capital gains tax. If they have full property rights to the asset they purchase, they could sell it and keep the full amount they receive for it without paying any capital gains tax.
Somebody who trades shares in order to make capital gains and who then withdraws a portion of their accumulated capital, in order to fund their living expenses, does not earn any income and should not be taxed on the capital gains they make. Instead, they are consuming a portion of the capital they have accumulated, in order to fund their living expenses.
However, income tax should be abolished, so that there should no longer be any need to tax income anyway.