In a no-relief founder-equity scenario, the effective tax burden can move from roughly 23.5 per cent under the old discount system to something around 46 to 47 per cent under the new rules.
“The proposed CGT change (if startup equity is included) would roughly double the tax on a successful founder exit in Australia from an effective ~23.5% today to ~46-47% under the new rules.”
This is broadly the same arithmetic frame as the existing founder-exit cases on the site. A top-rate individual founder under the old 50 per cent discount can face something like a 23.5 per cent effective rate on discounted gains, while the post-2027 treatment can approach the top marginal rate where indexation does little and no concession meaningfully reduces the gain. But the claim is still narrower than the post states: it assumes startup equity is fully within the new treatment, that little or no relief applies, and that the economically relevant gain is exposed to the post-2027 regime.
Assumptions required
- Assumes an individual founder taxed at or near the top marginal rate including Medicare.
- Assumes no small business CGT concession or targeted founder relief materially reduces the gain.
- Assumes the relevant founder gain is substantially post-1 July 2027.
Alternative defensible framings
- Some no-relief founder exits can move from the old discounted-gain benchmark toward a near-top-rate outcome under the redesign.
- The exact rate shift depends on cost base, timing, and concession eligibility.
Primary sources
Budget 2026-27 Tax reform page Capital gains tax · p.1 The Government will replace the 50 per cent Capital Gains Tax discount with a discount based on inflation and introduce a minimum 30 per cent tax on gains from 1 July 2027. ATO: Tax rates – Australian resident Resident tax rates 2025–26 · p.1 Resident top marginal tax settings provide the benchmark for the 46 to 47 per cent no-relief founder scenario. ATO: Small business CGT concessions eligibility overview How the concessions work · p.1 The small business CGT concessions allow you to reduce, disregard or defer some or all of a capital gain from an active asset used in a small business.