Tech founders use AI-generated images to poke fun at Anthony Albanese in protest against tax changes | Tax

Tech entrepreneurs have mocked the government’s capital gains tax changes by posting AI-generated photos of Anthony Albanese as their “new founder” and warning that rising taxes could push people away from working for new businesses or send new ventures abroad.

Startups and entrepreneurs may yet receive a change in the federal government’s planned changes to the CGT deduction, with the prime minister saying he wants to support innovation and treasurer Jim Chalmers revealing that consultations with the industry are ongoing.

The CGT changes, which replaced the 50% tax cut on profits with “cost-based indexation” – a tax on profits after inflation – and a minimum tax rate of 30%, were fiercely opposed by some tech founders. While early-stage startups with little cash flow often offer employees equity or stock options in the company in lieu of higher pay, founders may be motivated to take risks on new ventures with a big potential payday when selling their companies. The Australian Technology Council has warned both could be affected by CGT changes.

“There is work to be done to ensure Australia’s startup community does not suffer collateral damage as a result of the proposed changes,” the council’s chief executive Kate Cornick said.

Shadow treasurer Tim Wilson warned of “founder exodus abroad”. Janine Allis, co-founder of Boost Juice, also warned that rolling back CGT rebates would deter innovative businesses.

A small trend emerged among startup founders after budget night, with AI-generated photos of Albanese being posted in their offices.

“He’s having a great time with his 47% new capital,” wrote Jacques Greeff, founder of communications app Kinso, which posted AI footage of him and his staff in the Prime Minister’s office coding their products and working with customers.

“With the tax changes [the] The incentive to grow a business has been greatly reduced, but all the normal risks remain,” Greeff told Guardian Australia, warning it would be harder to attract talented employees if equity stakes were less lucrative.

“Australia should be encouraging young founders to build the next Canva. My fear is that they’re not even trying it now, or worse, they’re going abroad and building the next unicorn and Australia is completely missing out.”

Julian Fayad, managing director of loan comparison platform LoanOptions.ai, released AI footage showing Albanese sleeping in his company’s office and scrolling through his phone. He also warned about its impact on attracting workers and risk-taking.

Fayad attended a roundtable hosted by Wilson in Sydney on Saturday, where constituents criticized changes in government, and then met with the shadow treasurer at a media conference.

“With 47% CGT, the government’s message to founders like me is that if we are successful, they want almost half of the hard-earned reward,” Fayad said.

“When I look at what countries like Singapore and the UAE are doing to attract and retain founders, the incentives, the structures, the real support and then what Canberra is doing, it’s hard not to feel abandoned and stymied.”

Alfie Robertson, founder of video editing app Roll, posted AI footage of Albanese in the gym, recorded a podcast and worked on the strategy. He also feared that startups might look abroad.

“The problem is not just about taxes,” he said. “It’s about incentives. Policies like these are taking shape, where founders choose to build, invest and stay.

“If Australia wants to compete globally for talent and innovation, it must reward people who take productive risks to start companies, create jobs and grow the economy, not reduce the incentive to do so.”

Asked about the reaction on Friday, Albanese said he supports the startup sector, pointing to various budget incentives for research and development and instant asset write-offs. Chalmers acknowledged that start-ups may have a “different cost base” compared to other industries.

“We were already engaging with the technology sector, particularly the venture capital and startup sector, to make sure the changes accurately reflected the contribution we were looking for from the really important part of the economy,” he said.

Cornick said the Technology Council welcomed new R&D tax incentives and reforms to venture capital regulation and was keen to continue advising on CGT.

Economist Saul Eslake said there could be a case for CGT to be treated more generously, especially for new businesses starting from scratch, as they could pay tax on all profits as there is no cost base to index. He backed the government’s moves to replace CGT for property and shares and said it was unfair to expect startup founders to pay tax on business profits, but acknowledged that some new businesses, such as start-ups, may need incentives to encourage innovation and risk-taking.

“There are still pretty strong incentives,” Eslake said. “If you make $800 million instead of being a billionaire, is that less incentive?”

Another economist, Chris Richardson, warned that bowing to the CGT would be a mistake.

Incentives such as R&D tax offsets and instant asset write-offs are better for supporting early-stage businesses than deductions for future profits, he said. Richardson also supported a broader move to tax income from assets and income from labor more equally.

“Warren Buffett has a saying: ‘You may come across someone who has a great investment idea and won’t move forward with it because of the taxes he’ll pay if it’s successful. Send him my way. Let me lighten his load.'”