Greens warn Labour tax bill could let private‑school trusts avoid 30% levy

The Greens have raised concerns that the exemption for charities in the new discretionary‑trust tax may let private schools avoid the 30% minimum levy.

By Felo News Desk · Published Wed, 14 Oct 2026 09:12:14 GMT

The Greens have flagged a possible exemption in the government’s new discretionary‑trust tax that could allow private schools with charitable status to avoid the 30% minimum levy, according to statements made on 14 October 2026.

What happened

Treasure Jim Chalmers introduced legislation on Wednesday that imposes a 30% minimum tax on the net income of an estimated one million discretionary trusts each year. The measure is projected to raise more than $40 billion over the next decade, matching the revenue impact of other budget reforms.

The Greens have said they will move the issue to a Senate inquiry, focusing on an exemption that would exclude money paid to charities from the tax. Some private schools are registered as charities, meaning payments to them through trusts could be exempt.

What the reports add

SMH reported that the Greens’ economics spokesperson Nick McKim described the exemption as a “loophole” that could let private‑school fees flow through trusts without tax. The outlet also noted that the Coalition opposes any increase in taxes on trusts, while Labour needs Green support in the Senate to pass the measure.

In a later update, SMH added that business groups warned the reform could trigger costly turmoil, and that the New South Wales government plans to exempt trusts from stamp duty, a move likely to be mirrored by other states.

What was said

“It seems as if it w…,” Nick McKim told SMH.

Chalmers said the reforms are needed to stop revenue erosion, and that only a small proportion of people and businesses use trusts.

How it came about

The tax reform follows Labour’s May budget, which faced backlash after several measures were rolled back. Earlier this week, Treasurer Chalmers warned that without the trust levy, tax revenue would be “eaten away”. The Greens’ concerns echo earlier reporting by Felo News on the high cost of private‑school education in Sydney (Sydney private school fees could hit $800,000 for 13‑year education) and on the income levels of parents at elite schools (Four Sydney private schools join $500,000 parent‑income club).

Key facts

Labour introduced a 30% minimum tax on discretionary trusts (smh.com.au)
The tax is expected to raise over $40 billion in the next ten years (smh.com.au)
Greens claim an exemption for charities could let private schools avoid the tax (smh.com.au)