$500,000 capital gain lifetime limit is insubstantial and arbitrary
The $500,000 capital gain - not actual tax - limit in sec 160ZZPZB(3) is an insubstantial exemption. Given that the incentive is intended to reward those who invest in their superannuation by means of a business, $500,000 is not a figure that would provide an extravagant income stream to a retiree. Furthermore, the exemption is not indexed and therefore is of decreasing real value with time. Furthermore, there is no apparent policy reason why an arbitrary exemption limit of $500,000 has been chosen in sec 160ZZPZB(3).