If Labor really cared about our future, these tax breaks must go

1 week ago 2

Opinion

December 2, 2025 — 11.28am

When you hear someone say that Australia is “living beyond its means”, or as Opposition Leader Sussan Ley put it, about a culture of dependence that has “weakened both our finances and our national character”, they’re usually not talking about the billions in tax breaks for multimillionaire retirees, wealthy property investors or fossil fuel corporations.

They point to families who rely on childcare, and those with a disability. Or the teachers and nurses who take their salary from the public purse.

Unfair tax breaks such as the capital gains concessions are robbing young Australians of their chance to buy a home.

It seems that if you’re buying your fourth investment property, you’re a true-blue Aussie inspiration. But a student receiving rent assistance and Austudy? You’re a fiscal burden with a character flaw.

Since the government’s Economic Reform Roundtable identified intergenerational equity as a priority for reform, there’s been a surge of speeches and opinion pieces insisting Australia has a spending problem.

As a millennial worried about the future of the budget, this is an important conversation to have. But it’s clear that “intergenerational equity” is again being hijacked by some politicians, economists and media commentators to justify austerity.

Intergenerational equity as a spending issue has been the dominant frame since the 1990s. But a focus on balancing the budget has not prevented the worsening of living conditions for Australia’s younger generations.

We must wind back the capital gains tax discount, scrap negative gearing for landlords, and throw out generous superannuation tax breaks.

This narrow view of intergenerational equity doesn’t consider what truly matters. It neglects the distribution of wealth and opportunity, the quality of our natural assets and public services, resilience to risks, and whether life is improving.

It means that, on the one hand, our leaders claim they care deeply about younger people through their spending restraint. But then they support the capital gains tax discount, rapidly rising house prices, the privatisation of essential services, and the approval of new fossil fuel projects.

These policies drive intergenerational wealth inequality, record levels of private (rather than public) debt, and climate change, all of which are much more pressing concerns for younger Australians.

Yes, spending taxpayers’ money efficiently is important, but it’s difficult to feel thankful when our political leaders say we have a budget crisis while throwing tens of billions to the already wealthy.

In fairness to those who argue that we have a spending problem, they are right. But it’s not that we spend too much, it’s that we spend on the wrong things. According to OECD data, public spending in Australia is low, equivalent to 38.6 per cent of GDP, well below the OECD average (42.6 per cent) and even lower than the USA (39.1 per cent).

We are a world-leader in tax breaks, though, forgoing approximately 32 per cent of our tax revenue through concessions, which is well above the OECD average of 20 per cent.

The facts show that we are not big spenders, but rather a low-spending nation that shifts our resources from public investment in our collective capacity to private wealth accumulation.

Cutting public spending doesn’t make us better off. It starves us of long-term investments in our future. We must wind back the capital gains tax discount, scrap negative gearing for landlords, subsidies for the fossil fuel industry and throw out generous superannuation tax breaks.

By doing so, work and effort will be rewarded, not speculation, accumulation and rent-seeking. We can shift our public resources into building new homes, funding world-leading public services, making tertiary education affordable, and developing clean-energy and digital infrastructure.

To truly champion intergenerational equity, our leaders must invest in younger generations, not impose austerity in our name. We are not a burden. We just want to get a good, affordable education, to work hard, buy a home, start a family and live on a healthy planet.

Just like generations prior. But that’s being taken from us by the real dependents on the public purse.

Thomas Walker is the CEO of Think Forward, an economics think tank run by younger Australians.

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