Australia’s blunder, New Zealand’s opportunity

Sunday, 31 May 2026

Dr Michael Turner is founder of strategic advisory firm Freshwater Strategy and public affairs technology company PollStream.

OPINION: For decades, Australia has been doing something deeply irritating to New Zealand. It has systematically been stealing Kiwis.

The numbers are not small. Hundreds of thousands have made the crossing, lured by bigger salaries, warmer winters, and the vague promise of a comfortable life. New Zealanders built Australian hospitals, staffed their construction sites, and populated their rugby league teams with players who many suspect were superior at the game.

Australian Treasurer Jim Chalmers may have just handed New Zealand a chance to return the favour.

Last year, in the final days of an election campaign, PM Anthony Albanese and the Australian Labor Party looked voters squarely in the eye and promised they would not touch capital gains tax. Labor went on to win the election. Since then, it has been struck by a unique bout of political courage that only tends to materialise when all the votes are counted. It changed its mind entirely.

The government calls it courageous. Entrepreneurs I speak to use other words.

From July 2027, Australians will pay a minimum of 30% tax on all capital gains. For many the real number will be closer to 47%. The tax rate has effectively doubled. For anyone who has spent years building something to get ahead, it feels like a cynical move by a government searching for cash to balance its books.

The 5am starts, the missed school plays, the remortgaged homes. Founders have already paid once. Most businesses fail in the first five years. Those that survive are now expected to hand almost half their upside to the government. If there is one thing you can say about Aussie entrepreneurs, it's that they aren’t the type to accept a bad deal quietly. The government is seriously copping it. Right now, the solution for many looks like a one-way flight and a conversation with a New Zealand tax adviser.

This is the moment for New Zealand to plant its flag as the CGT-free base camp of choice for founders, investors, and entrepreneurs across the Asia-Pacific.

New Zealand has no comprehensive capital gains tax regime. There is no tax on gains from investing in New Zealand and most Australian shares. If you build a company, scale it, and exit, the proceeds of that risk, largely remain yours. For years this has been framed as a failure of nerve. But a single Australian budget has turned what was seen as an embarrassing omission into competitive economic weapon. New Zealand should embrace the point of difference and attract builders of the new economy to set up shop in Aotearoa.

The foundations are already there. Rod Drury founded Xero in Wellington in 2006, cloud accounting software that now has over 4 million subscribers across the planet. There’s Auckland-founded Rocket Lab, cattle management software Halter, Crimson Education and too many other examples to list. But you get the point, New Zealand has form, having already built many globally competitive businesses.

But here is a point that often gets lost: founders don't just create companies. They create jobs; high-paying, high-skill employment that didn't exist before. Behind every successful founder are dozens, sometimes hundreds, of well-paid engineers, designers, salespeople, and operators building careers and spending money in the local economy. Attracting a single ambitious founder to New Zealand isn't a symbolic win. It’s good economic sense.

Capital infrastructure in the region is already deeply trans-Tasman. Icehouse Ventures has deployed over $800m across more than 380 companies. Blackbird, the Australian firm that backed Canva before it was a thing, has opened a dedicated Auckland office and raised a seed fund specifically for New Zealand founders. AirTree Ventures backs founders across Australia and New Zealand from the earliest stages. The money already knows New Zealand well. Founders just need the invitation.

For Australian entrepreneurs this is as close to home as it gets. Almost 100,000 Australians already live in New Zealand. No visas. No foreign legal maze. No culture shock. Auckland is a manageable flight from Sydney, the legal systems are cousins, and the startup networks are already entangled. New Zealand is simply a better-priced version of home.

New Zealand should meet this moment with active policy. Targeted incentives for relocating founders. A streamlined pathway for high-value investors. A clear signal from Wellington that intellectual and financial capital isn't merely tolerated, it is actively, aggressively valued and welcomed.

The financial and intellectual capital flowing out of Australia over the next few years will land somewhere. Singapore and Dubai are already sharpening their pencils.

Wellington didn't create this opportunity. Canberra did. After decades of watching its best head east, New Zealand finally gets a chance to return the favour.

What do you think? Email sundayletters@stuff.co.nz. Please include your full name and address.