Australian Treasurer's Proposed 30% Minimum Tax on Discretionary Trusts Faces Business Opposition

The Australian federal budget slated a new measure that would require trustees of discretionary trusts to pay a minimum tax of 30% on taxable income from 1 July 2028. Treasury Minister Jim Chalmers says the policy aims to curb income‑splitting and align trust income tax with employee tax rates.

The Australian Chamber of Commerce and Industry (ACCI), led by CEO Andrew McKellar, warned that the proposal would impose a massive tax increase on small and family‑run businesses, estimating over $4 billion in additional revenue in its first year and higher compliance and restructuring costs. The Council of Small Business Organisations Australia (COSBOA), headed by CEO Skye Cappuccio, echoed the criticism, noting that roughly 350,000 small businesses use discretionary trusts and that restructuring could cost between $3 billion and $10 billion overall. Both groups argued the blanket rule would unfairly target legitimate commercial structures and called for more targeted anti‑avoidance measures.