Should a tax and transfer system be progressive to compress uneven growth? We address this question through the lens of the Australian unique experience of three decades of uninterrupted economic growth between 1991 and 2020. First, we use confidentialised tax records of millions of Australian taxpayers to document how the economic gains have been shared across households and generations over time. We find that there has been a rising inequality trend in pre-government income. However, the highly progressive income tax and transfer system has effectively kept income inequality in check. The Gini coefficient of post-government income has been fairly stable around 0.38, especially since 2005. By tracking lifetime income of 9 cohorts of individuals over 20 years, we also find that the trends in net lifetime income inequality are relatively stable. Next, we build a dynamic general equilibrium model to study how a government could reform progressive tax and transfer policies in response to shifts in the income distribution like those observed in Australia.