Originally published by Glen Hingley, NT Chamber of Commerce and Industry CEO of NT News
27.05.2026
Instead of driving productivity and improving Australians’ lives, this budget risks penalising hard work, taxing business growth and stifling entrepreneurship.
Across the Northern Territory, small and medium-sized business owners and investors are trying to make sense of proposed changes to capital gains tax, and what they mean for their future.
The confusion is real, but so too is the concern.
The Territory is widely recognised as having the highest small-business density per capita in Australia, making us uniquely exposed to policy decisions that shape investment and economic confidence.
When the rules around investment change, the Northern Territory feels it first, and often more deeply than the rest of the country.
At its core, this debate is about incentives.
Our economy depends heavily on the courage of Territorians to back themselves, to take risks, and to build something from nothing.
Small and medium-sized business owners routinely invest years of effort, personal sacrifice and capital into their ventures.
For many, it is not until they sell that business that they are finally remunerated for that work, alongside the investors who supported them along the way.
The proposed changes cut directly into that moment.
As these proposed reforms replace the 50 per cent CGT discount with inflation-based indexing and introduce a minimum 30 per cent tax on gains from 1 July 2027.
In some cases, particularly where asset growth exceeds inflation, this may result in higher tax outcomes for business owners and investors.
By increasing the tax paid on the real gain when an asset is sold, the reforms reduce the after-tax return on business exits and long-held investments.
For small and medium-sized business owners, founders and investors, this is not an abstract concept.
It is the difference between reinvesting in a new venture, retiring with dignity, or questioning whether the risk was worth it in the first place.
The shift from the long standing 50 per cent capital gains tax discount to a model based on inflation indexing, combined with a minimum 30 per cent tax on gains from July 2027, introduces uncertainty and, in many cases, higher tax liabilities.
Those whose assets have grown strongly over time, particularly beyond inflation, may find themselves worse off.
This matters most at the point of sale.
That is when many small and medium-sized business owners depend on proceeds to fund retirement or their next chapter.
If the after-tax outcome is diminished, it weakens the incentive to grow, invest, or take on higher risk opportunities.
It also changes behaviour.
Owners may delay selling. They may scale back expansion plans. They may seek higher valuations simply to offset the additional tax burden. In short, the policy alters the economics of ambition.
But just as importantly, it risks shaping the mindset of the next generation.
It risks stifling the ambitions of future entrepreneurs and investors by sending the wrong signal, that it is safer and more rewarding to seek a job in the federal public service than to back yourself, pursue an idea and create something of your own.
That is not the message Australia should be sending.
We should be fostering an environment where people are encouraged to take risks, where others are willing to back their vision, and where success is not unduly penalised when it is finally realised.
While the government has pointed to exemptions, including the family home and existing small and medium-sized business concessions, the broader impact remains significant.
Many Territorians with non-exempt assets will face increased tax liabilities, adding uncertainty to decision making and limiting further investment growth.
The stated aim may be fairness, taxing “real gains” rather than nominal ones.
But policy intent does not always align with economic reality. In practice, these changes risk discouraging the very activity needed to lift productivity, business formation and long-term growth.
As Australian Chamber of Commerce and Industry CEO Andrew McKellar has said, “You will not get business investment if you are going to tax investment, it is counter-productive.” That point goes to the heart of this debate.
It is a simple question: why would someone invest everything they have into building a business, knowing that when they finally realise the value of that work, a larger share will be taken?
This is why business groups across the country are calling for a reset, not minor adjustments or carve-outs.
Tax reform is important. But reform must strengthen the economy, not weaken the foundations on which it is built.
For the Northern Territory, the stakes are particularly high. Small and medium-sized business is not just part of our economy, it is the engine of it.
Getting these settings wrong risks slowing investment, reducing ambition and ultimately limiting opportunity.
The Federal Government should pause, listen and reconsider.
Because when you tax investment more heavily, you do not just change revenue outcomes, you change behaviour.
And right now, that is a risk we cannot afford.