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May 21, 2026 — 5:00am
Why is the Labor premier of NSW going in to bat for high wage earners less than a year out from an election in which, polls repeatedly show, cost of living is overwhelmingly the top issue for voters?
To remind you, on Wednesday, when asked about the federal government’s changes to capital gains tax (CGT), Minns called for “urgent” income tax cuts. “Working families”, he said, were being “stung”.
“You’re working Monday, Tuesday, and half of Wednesday for yourself, and then Wednesday, Thursday, and Friday for the government,” he said.
“That’s a tough burden for a lot of families.”
Which working families was he talking about, though? Minns’ comments were peculiarly focused on the top marginal tax rate of 45 per cent, plus the 2 per cent Medicare levy.
To put that in real terms, the top tax bracket in Australia is about $190,000, and the 45 per cent rate only applies on every dollar earned above that.
So even the premier of NSW, whose total pay package is about $416,000, only has an average tax rate of about 37 per cent.
In other words, anyone being taxed at 47 per cent of their income would be living in a very different world to any of the working families I know.
It seems a strange cohort to fly the flag for. The tax office’s most recent statistics report from 2022-23 said only about 5.3 per cent of the population was in the top tax bracket. The figure in NSW is probably slightly higher, about 6.4 per cent.
That, admittedly, is slightly out of date; the top tax rate then was only $180,000. But it’s probably a safe assumption that we aren’t talking about a particularly large cohort of western Sydney marginal seat voters.
So, why the impassioned defence of the mega-rich? Well, first, the reality of aspirational politics is everyone hopes to use complicated tax avoidance measures one day.
And there is a more nuanced argument here about the role bracket creep has had in nullifying some of the benefits of the wage increases to public-sector workers delivered by the NSW government this term.
While that has very little to do with the top tax rate, Minns made the point that bracket creep generally was impacting those middle-wage earners. And as long as you’re on record saying lower taxes are good, most people won’t look into the detail too much anyway; no one thinks they pay too little in tax.
But probably more to the point, when viewed through the lens of capital gains tax changes causing the federal government so many headaches post-budget, the argument for a tax cut at the top end of the wage bracket makes slightly more sense and has more to do with Minns distancing himself from Canberra than anything else.
While Minns is not inclined to come out and openly criticise the feds over CGT, his comments could be read as a critique of Anthony Albanese and Jim Chalmers over the way the policy has been sold.
It is true that, if the changes to CGT were accompanied by the carrot of a tax rate below 45 cents in the dollar, Albanese might not be getting so much heat from everyone’s favourite cohort of people: wealthy start-up investors. And there is also an argument that the closer the marginal tax rate is to the company tax rate, the less inclined the investor class might be to utilise tax avoidance mechanisms in the first place.
Most importantly for Minns, though, his comments create a clear separation between the federal and NSW Labor brands. For a government ultra-sensitive to opening itself up to attacks from the right via the Coalition or One Nation, it sees significant political benefit in nullifying any notion Minns is in lockstep with his federal counterparts.
It’s a well-trodden path. In fact, it’s almost four years to the day that former NSW Premier Dominic Perrottet was at a press conference with his Liberal Party colleague, then-prime minister Scott Morrison, and was asked about a home equity scheme floated by the federal Labor opposition.
The Help to Buy scheme, in which the federal government co-purchases up to 40 per cent of a new property, or 30 per cent of an existing one, had been derided by Morrison, who claimed that Labor “wants the government to own your home”.
Perrottet though, refused to buy in to Morrison’s criticisms. Less than a year out from the election which would end the Coalition’s 12 years in government in NSW, he was keen to put some distance between himself and an unpopular prime minister.
So, in one of those awkward exchanges press conferences can sometimes throw up, Perrottet took a veiled swipe at Morrison while the prime minister stood beside him.
“I’m open to all ideas in relation to how we can drive home ownership,” he said of the scheme. “We have an obligation, I believe, to look at innovative thinking about helping particularly young people get their keys to their very first home.”
Minns is heading in much the same direction. While he may not be quite as direct as Perrottet, the last thing Minns wants is for the NSW election in March to be a referendum on the federal government.
By homing in on tax cuts, after similarly criticising the lack of infrastructure funds for NSW and the GST carve-up, the premier is looking to avoid being tarred with Albanese’s brush.
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