From NZ Herald · · 1m 30s
NZ Super Fund helped Australia drop retrospective capital gains tax proposal
NZ Super Fund and Canada's pension fund urged Australia to drop retrospective capital gains tax changes, leading to revised proposals.
In brief
NZ Super Fund and Canada's pension fund urged Australia to drop retrospective capital gains tax changes, leading to revised proposals. Australia abandoned backdating capital gains tax changes after NZ Super Fund and Canada's pension fund warned it would weaken investment confidence. Originally reported by NZ Herald.
NZ Super Fund's role
The NZ Super Fund and Canada's Public Sector Pension Investment Board raised concerns directly with the Australian Government.
“As currently drafted, the Government would be taxing long-term foreign investors on gains that accrued when such assets were not subject to CGT in Australia”
Tax proposal details
Australia proposed broadening capital gains tax to include wind turbines and transmission lines, backdating changes to 2006.
Inland Revenue's stance
Inland Revenue initially declined to share impact analysis with Australian officials, citing potential damage to New Zealand-Australia relations.
“making available ... that information would be likely to prejudice the security or defence of New Zealand or the international relations of the Government of New Zealand”
Ombudsman intervention
The Ombudsman forced Inland Revenue to release briefing after Finance Minister Nicola Willis criticized Australia's tax changes.
Investment concerns
Inland Revenue warned reduced Australian investment could impact New Zealand as investors often follow with New Zealand investments.
“direct investment in New Zealand often follows as a second step from direct investment into Australia”
Revised proposal
Australia ended up applying tax changes forward only, abandoning retrospective backdating to 2006.
NZ Super Fund assets
The NZ Super Fund manages NZ$89.9 billion as of 31 October 2025, investing globally including in Australia.
“NZ$89.9 billion of assets under management as at 31 October 2025 and invests in diversified assets throughout the world, including Australia”
Political reaction
National Party finance spokeswoman Nicola Willis called the tax changes 'extra tax backfiring' and damaging for investment.
“another example of extra tax backfiring and damaging prospects for investment and growth”
Investment impact
Inland Revenue warned tax changes could lead to decreased confidence in Australia as a location for long-term investment.
“commentators warn that the changes, particularly if made without transitional relief, may lead to decreased confidence in Australia as a location for long-term investment”
Current status
Changes to Australia's capital gains tax took effect on October 1, 2026.
What to remember
Australia abandoned backdating capital gains tax changes after NZ Super Fund and Canada's pension fund warned it would weaken investment confidence.
