Taxing titans: could a ‘super profits tax’ on corporates fix Australia’s housing crisis?

The Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) has launched a national campaign advocating for a novel solution to Australia’s housing crisis: a tax on the excess earnings of corporate giants. The union suggests that the revenue generated from this tax could be funnelled into the rapid construction of social and affordable housing.

The CFMEU commissioned an independent report from Oxford Economics Australia to assess the feasibility of a tax on excess profits and its potential to fund social and affordable projects. The report highlighted that Australia currently has a shortfall of 750,700 social and affordable dwellings.

To close this gap by 2041, an estimated investment of over $500 billion would be required. The CFMEU believes that this amount could be “comfortably” covered by what they have termed a “super profits tax”.

The campaign, dubbed “End the Housing Crisis, Tax Super Profits”, was launched on 25 July. Zach Smith, CFMEU’s national secretary, argues that the scale of Australia’s housing crisis necessitates bold solutions. He explained that the primary issue facing the union’s members is housing. “A super profits tax is the fairest way to raise the billions of dollars needed to guarantee every Australian has the basic right of shelter,” Smith stated.

Smith also noted that the implementation of such a tax would help to close the housing gap “without discouraging investment or creating distortions in the market”. He added, “By taking back just a slice of exorbitant profits gouged from hardworking Australians, we can transform society to benefit all.”

The proposed plan would reportedly not affect 99.7% of Australian businesses. Smith clarified that “the tax only kicks in when corporations make astronomical profits”. He urged the federal government to seize the opportunity to define its legacy by ending homelessness, boosting productivity, and lifting millions out of poverty.

“Let’s be the generation that didn’t let this crisis become the norm. Tax super profits, fix the housing crisis,” the national secretary concluded. The campaign represents a bold and innovative approach to addressing Australia’s housing crisis, and it remains to be seen how it will be received by the wider public and the corporate sector.