The Great Aussie Space Exodus: How Tax Policies Are Launching Startups Overseas
There’s something deeply ironic about an Australian space company choosing to blast off in the U.S. instead of its home country. But that’s exactly what Gilmour Space, a Queensland-based rocket startup, is planning to do. And while the company’s CEO, Adam Gilmour, cites access to space-savvy investors as a key reason, the real story here is far more grounded—and far more troubling. It’s about tax policies, entrepreneurial confidence, and the unintended consequences of well-intentioned reforms.
The Tax That’s Sending Startups Packing
Labor’s decision to overhaul capital gains tax (CGT) has sent shockwaves through Australia’s startup ecosystem. The plan? Scrap the 50% CGT discount and replace it with an inflation-adjusted model, effectively raising the minimum tax rate to 30%. On paper, it’s a move to level the playing field. In practice, it’s a red flag for entrepreneurs like Gilmour, who see it as a disincentive to list on the ASX.
Personally, I think what makes this particularly fascinating is the psychological impact of such policies. It’s not just about the numbers—it’s about perception. When founders like Gilmour say they’re “nervous” about listing locally, they’re not just talking about tax rates. They’re talking about uncertainty, about a sense that the rules of the game are shifting mid-play. And in the high-stakes world of startups, uncertainty is the enemy of innovation.
What many people don’t realize is that tax policies aren’t just financial tools—they’re signals. They tell entrepreneurs where they’re valued, where they’re welcome. Right now, Australia’s signal is mixed at best. And in a globalized economy, where capital and talent are borderless, mixed signals are enough to send companies packing.
The Space Race We’re Losing Before It Starts
Gilmour Space isn’t just any startup. It’s part of a burgeoning space industry that Australia could—and should—be leading. With plans to build a rocket capable of flying at seven times the speed of sound, the company is a poster child for Aussie innovation. Yet, under the new tax settings, Gilmour warns that smaller space companies will struggle to attract local investors.
From my perspective, this is where the real tragedy lies. Space isn’t just a sector—it’s a frontier. It’s about pushing boundaries, solving global challenges, and inspiring the next generation. But if Australia’s tax policies make it harder for these companies to get off the ground, we’re not just losing businesses. We’re losing our place in the story of human progress.
One thing that immediately stands out is the irony of it all. Australia has the talent, the resources, and the ambition to be a space powerhouse. Yet, we’re effectively outsourcing our future to overseas investors. Gilmour’s warning that Australian space and defense companies will become more foreign-owned isn’t just a prediction—it’s a wake-up call.
The Broader Implications: When Policy Meets Psychology
If you take a step back and think about it, the CGT debate is about more than just tax rates. It’s about the relationship between government and innovation. It’s about how policy decisions ripple through ecosystems, shaping behavior in ways that aren’t always obvious.
A detail that I find especially interesting is the “founder universe” Gilmour describes. He’s not alone in his concerns. SafetyCulture’s Luke Anear and TEN13’s Steve Baxter have both sounded the alarm, warning that the CGT changes will stifle startup formation. What this really suggests is that tax policy isn’t just a financial issue—it’s a cultural one. It shapes the mindset of entrepreneurs, influencing whether they see Australia as a launchpad or a liability.
This raises a deeper question: Are we willing to trade short-term revenue gains for long-term innovation losses? Because that’s the choice we’re making. And in a world where countries are competing not just for capital but for the companies of the future, it’s a choice we can’t afford to get wrong.
The Future: A Sky Full of What-Ifs
Gilmour Space’s decision to list on Nasdaq isn’t just a business move—it’s a symbol. It’s a reminder that in the global race for innovation, borders are irrelevant. What matters is where companies feel supported, valued, and free to dream big.
In my opinion, Australia has a unique opportunity here. We could double down on our strengths, creating policies that attract—not repel—entrepreneurs. We could position ourselves as the go-to destination for space startups, leveraging our geographic advantages and scientific expertise. Instead, we’re watching companies like Gilmour Space look elsewhere.
What this really suggests is that the CGT debate is just the tip of the iceberg. It’s part of a larger conversation about Australia’s role in the global economy, about whether we’re content to be followers or if we dare to lead.
Final Thoughts: A Call to Recalibrate
As Gilmour Space prepares for its U.S. launch, I can’t help but wonder what could have been. What if Australia had been the place where this company—and others like it—chose to take off? What if our policies had been designed not just to tax innovation but to nurture it?
Personally, I think the CGT changes are a missed opportunity. They’re a reminder that policy isn’t just about numbers—it’s about narratives. And right now, the narrative is that Australia is a risky bet for startups.
But it doesn’t have to be this way. We can recalibrate. We can send a new signal—one that says Australia is open for innovation, open for ambition, open for the future. Because if we don’t, we’ll be left watching from the ground as companies like Gilmour Space soar into the stars—just not under our flag.
