The policy that is not yet law is already changing decisions
Australia's proposed capital gains tax overhaul is pushing startups to consider offshore moves earlier than they would otherwise plan. The policy would replace the 50% CGT discount with cost-base indexation and a 30% minimum tax on gains. Startup leaders say it is already affecting founder and investor behaviour.
The strongest signal: founders are rethinking when to move talent, operations, or headquarters offshore. Equity becomes less attractive and harder to restructure the longer they wait.
Why this matters for sales teams
If you are joining a high-growth startup, equity is part of your comp. The proposed tax changes affect how attractive that equity remains, especially if the company is venture-backed and considering a Delaware flip or offshore expansion.
Richard Pringle, principal lawyer at Viridian Lawyers, sees several Australian startups re-domicile each year. "The longer they stay, the more complicated the flip-up is likely to be, and they are incentivised to go as early as possible," he said.
Once a startup has revenue, raised capital, and established a clearer valuation, the process becomes much more complicated, particularly because of potential CGT implications. For employees holding options or restricted stock, that complexity can affect vesting schedules, strike prices, and tax treatment.
The broader context
The government has tried to offset some pressure with Budget 2026 measures, including loss refundability for up to 25,000 startups a year and expanded venture capital tax incentives from 1 July 2027. Sector bodies argue the CGT changes and R&D tightening create a pincer movement that could squeeze early-stage companies' access to capital and staff.
Investor submissions to a parliamentary inquiry say capital is being delayed, paused, or redirected offshore. Australia is competing against New Zealand, Singapore, the US, the UK, and the UAE for mobile talent and capital. FinTech Australia warned the uncertainty could immediately affect startup funding, particularly for businesses that depend on equity incentives and risk-tolerant investors.
What this means for comp planning
If you are evaluating a startup offer, ask:
- Where is the company incorporated?
- Are they considering a Delaware flip or offshore restructure?
- How does the equity grant get taxed if the company re-domiciles?
- What happens to vesting schedules if the corporate structure changes?
The answers matter. Equity that looks solid on paper can get messy fast if the company moves jurisdictions mid-vesting period.
This is not about one startup. It is about the broader ANZ startup base, especially high-growth firms that rely on ESOPs, venture capital, and founder equity upside. If you are in sales at a venture-backed company, the policy debate is worth tracking. It affects your comp, not just the founder cap table.