Just when I thought the fiscal illiteracy couldn’t get worse than Drowsy Joe Biden’s plan-or whoever’s plan it was-to tax unrealized capital gains last year… along comes the Australian Labour government to shout, “Hold my Foster’s!”

In a way, we must be thankful. This plan is so stupid and destructive, it’ll kill Australia’s economy for all the world to see… and then even the most leftist governments won’t dare replicate it anywhere in the Northern Hemisphere. I hope you celebrated Memorial Day weekend, and being American, like you never have before!

Yes, our friends Down Under are outdoing Washington in stupidity—and that’s no small feat. The Aussies want to impose a 30% tax on unrealized capital gains in what they call “superannuation” accounts.

Wait—what the heck is a superannuation account?

Let me translate from Australian Bureaucratese to American English.

What Is Superannuation?

Superannuation is Australia’s version of a 401(k) on steroids. It’s a mandatory retirement account where your employer contributes a chunk of your income (currently 11%) into a managed fund. You can also contribute voluntarily.

The goal? Build a fat retirement nest egg and reduce reliance on government pensions.

That is, until the government gets greedy and decides to rob the very account it forces you to fund.

What Australia Just Proposed

Labour’s genius plan is to:

• Slap an extra 15% tax on earnings—on top of the existing 15%—for super accounts over AUD 3 million (~USD 2 million).
  
  
• But here’s the kicker: That 30% tax applies to unrealized gains.
  
  
• So if your investments go up in value—even if you don’t sell them—you pay tax anyway.
  
  
• And no, they’re not indexing the $3 million threshold to inflation. As asset prices rise, more Australians will be swept into this trap.

Simply put, you pay tax on money you don’t have. It’s a theoretical gain, a number on a screen. Until you sell the asset, you can’t access the value. But you’ll still owe the taxman.

That’s not taxation. That’s confiscation.

Why This Is Dumb—Dumb!

Let’s walk through it using our favorite stock example.

Say you buy a stock for $10. By December 31, it’s trading at $18. That’s an $8 unrealized gain. You didn’t sell. You didn’t lock in profit. But under this new rule, you’d owe 30% on the $8.

That’s $2.40 in taxes—even though you haven’t seen a penny of cash.

And what if the stock crashes in January? You’re still out $2.40.

Now imagine this in a retirement account full of long-term, illiquid holdings—startups, property trusts, private equity. You could owe the tax with no way to get the cash except by selling something else, just to pay for a gain you never realized.

It’s not just unfair. It’s a full-blown forced liquidation policy—a fire sale disguised as a tax.

Short-Termism on Steroids

If implemented, this will destroy long-term investment strategy.

Who would keep a startup going through the J-curve years if the government were to tax its theoretical markup before exit?

Who would buy volatile assets that could swing up one year (and get taxed) and crash the next (and leave you with no refund)?

This policy doesn’t just discourage risk—it nukes it.

And for what? A temporary revenue bump at the cost of a generation’s future growth.

Double Taxation and a Trojan Horse

Remember: Australians will still be taxed again when they eventually sell the asset. So yes, this is double taxation—just without any of the finesse.

Critics are rightly calling it a “Trojan horse.” First, it’s super accounts. Then it’s houses. Then stocks. Maybe even family heirlooms. Why not? If it has value, why not tax the imagined appreciation?

And let’s not pretend this madness won’t migrate overseas. Once one Western government breaks the seal, others will follow. Washington’s already shown its envy.

Remember Joke Biden’s own proposed version of this tax? I tore it apart last year. That was a 25% annual tax on unrealized gains for people with assets over $100 million. Thankfully, Congress shelved it.

But if Australia does this, you can bet U.S. Democrats will grab that blueprint off the shelf faster than Kamala can explain Venn diagrams.

Why This Must Be Destroyed

This policy violates the ability-to-pay principle. You’re taxing phantom wealth. People might have high-value holdings and zero liquidity. It encourages forced selling, drives market volatility, and distorts price discovery. It disincentivizes long-term investment in the kind of assets (innovation, infrastructure, venture capital) that generate future prosperity. It erodes trust in the retirement system—the very thing governments require their citizens to participate in.

Worst of all, it blurs the line between income and wealth. And once you open the door to taxing wealth instead of income, you’ve opened an authoritarian can of worms.

Wrap-Up

Have the politicians in Canberra lost their minds?

They’re hammering the retirement system they built, creating a disincentive for entrepreneurship, and turning Australia from a land of opportunity into a retirement dystopia.

Australia already has a housing affordability crisis, a shrinking middle class, and a brain drain. Do they want to speed up the exit? Then, by all means, keep threatening retirees with paper-asset theft.

The only thing worse than Biden's idiocy is someone copying it... and adding Vegemite. Yuck!