Labor may team up with Coalition to pass $3m superannuation accounts tax legislation
Labor could shun the Greens and work with the Coalition on increasing taxes on superannuation accounts worth more than $3m, after the prime minister, Anthony Albanese, signalled he was open to constructive talks to pass the delayed legislation.
The deputy Liberal leader, Ted O'Brien, this week suggested possible talks as part of efforts to help address the structural budget deficit, but insisted the treasurer, Jim Chalmers, would have to radically change the proposal, including ending moves to tax unrealised gains.
Labor plans to double the earnings tax on superannuation balances above $3m – from 15% to 30%. The plan, first announced in late 2023, affects only an estimated 80,000 people, and still leaves in place highly favourable tax treatment for retirement savings.
Sign up for Guardian Australia's breaking news email
Labor is expected to pass the changes with the support of the Greens, once the minor party has the sole balance of power in the Senate after 1 July.
Politicians won't be exempt from the change, even if their retirement savings are in so-called defined benefit accounts. Separate regulation, allowing some payments to be deferred, is expected to explain how the accounts will be treated.
Defined benefit rules are based on a formula for retirement savings – usually using an individual's salary level at retirement – rather than contributions made throughout their working life. Many politicians elected before 2014 are entitled to defined benefits, along with former bureaucrats and judges.
The Greens leader, Larissa Waters, has warned Labor any special arrangements for politicians and other former public officials would be unworkable.
The Greens also want a threshold of $2m so more account holders are covered by the tax.
Speaking during a visit to Perth on Tuesday, Albanese said Labor was open to working with the Coalition.
'We obviously work with different parties. If the signal from the Coalition is across the board – I'm not talking specifically here – that they will be more constructive and not just be part of a 'No-alition' with the Greens party, then that would be welcome.'
He said voters wanted MPs to work constructively and called on the Coalition to support Labor's plans to cut higher education debts for university graduates when parliament resumes on 22 July.
Albanese said politicians are not exempt. 'They're not exempt, full stop.'
'That was clear in the previous legislation that was introduced.'
Sign up to Breaking News Australia
Get the most important news as it breaks
after newsletter promotion
O'Brien told the Australian newspaper Labor's plans to tax unrealised capital gains, profits for investments which exist on paper because the asset has not be sold, would 'breach a red line'.
'But if Jim Chalmers is prepared to be humble for a moment and realise he's made a mistake and wishes to engage with me, my door is open,' O'Brien said on Monday.
Albanese is expected to hold talks with Waters in coming weeks. Greens MPs are yet to settle on a final position on the issue.
Waters told ABC radio the party was waiting to see the government's final proposal.
'There's been some suggestion that there'll be some changes to the government's approach, potentially giving politicians a free pass from this proposed super tax, which doesn't seem like such a good idea,' she said.
'In the last term we did think that you could raise more revenue from folk who are doing very nicely for themselves, and that it is important that we have a revenue base.'
In the last parliament, key senate crossbenchers including David Pocock and Jacqui Lambie were opposed to taxing unrealised capital gains.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
44 minutes ago
- The Independent
Can Pope Leo XIV solve the Vatican funding crisis? Here's how the Holy See manages money
Vatican City, the world's smallest country, is facing a significant budget deficit. The city-state primarily relies on donations, ticket sales from the Vatican Museums, investment income, and its real estate holdings to finance the Catholic Church's central government. And unlike other nations, the Vatican does not tax its residents or issue bonds. In 2022, the Holy See published a consolidated budget projecting 770 million euros, with the majority allocated to embassies worldwide and Vatican media operations. However, in recent years, revenue has fallen short of covering expenses. Pope Leo XIV now faces the challenge of securing the necessary funds to steer the Vatican out of its financial difficulties. Withering donations Anyone can donate money to the Vatican, but the regular sources come in two main forms. Canon law requires bishops around the world to pay an annual fee, with amounts varying and at bishops' discretion 'according to the resources of their dioceses.' U.S. bishops contributed over one-third of the $22 million (19.3 million euros) collected annually under the provision from 2021-2023, according to Vatican data. The other main source of annual donations is more well-known to ordinary Catholics: Peter's Pence, a special collection usually taken on the last Sunday of June. From 2021-2023, individual Catholics in the U.S. gave an average $27 million (23.7 million euros) to Peter's Pence, more than half the global total. American generosity hasn't prevented overall Peter's Pence contributions from cratering. After hitting a high of $101 million (88.6 million euros) in 2006, contributions hovered around $75 million (66.8 million euros) during the 2010's then tanked to $47 million (41.2 million euros) during the first year of the COVID-19 pandemic, when many churches were closed. Donations remained low in the following years, amid revelations of the Vatican's bungled investment in a London property, a former Harrod's warehouse that it hoped to develop into luxury apartments. The scandal and ensuing trial confirmed that the vast majority of Peter's Pence contributions had funded the Holy See's budgetary shortfalls, not papal charity initiatives as many parishioners had been led to believe. Peter's Pence donations rose slightly in 2023 and Vatican officials expect more growth going forward, in part because there has traditionally been a bump immediately after papal elections. New donors The Vatican bank and the city state's governorate, which controls the museums, also make annual contributions to the pope. As recently as a decade ago, the bank gave the pope around 55 million euros ($62.7 million) a year to help with the budget. But the amounts have dwindled; the bank gave nothing specifically to the pope in 2023, despite registering a net profit of 30 million euros ($34.2 million), according to its financial statements. The governorate's giving has likewise dropped off. Some Vatican officials ask how the Holy See can credibly ask donors to be more generous when its own institutions are holding back. Leo will need to attract donations from outside the U.S., no small task given the different culture of philanthropy, said the Rev. Robert Gahl, director of the Church Management Program at Catholic University of America's business school. He noted that in Europe there is much less of a tradition (and tax advantage) of individual philanthropy, with corporations and government entities doing most of the donating or allocating designated tax dollars. Even more important is leaving behind the 'mendicant mentality' of fundraising to address a particular problem, and instead encouraging Catholics to invest in the church as a project, he said. Speaking right after Leo's installation ceremony in St. Peter's Square, which drew around 200,000 people, Gahl asked: 'Don't you think there were a lot of people there that would have loved to contribute to that and to the pontificate?' In the U.S., donation baskets are passed around at every Sunday Mass. Not so at the Vatican. Untapped real estate The Vatican has 4,249 properties in Italy and 1,200 more in London, Paris, Geneva and Lausanne, Switzerland. Only about one-fifth are rented at fair market value, according to the annual report from the APSA patrimony office, which manages them. Some 70% generate no income because they house Vatican or other church offices; the remaining 10% are rented at reduced rents to Vatican employees. In 2023, these properties only generated 35 million euros ($39.9 million) in profit. Financial analysts have long identified such undervalued real estate as a source of potential revenue. But Ward Fitzgerald, the president of the U.S.-based Papal Foundation, which finances papal charities, said the Vatican should also be willing to sell properties, especially those too expensive to maintain. Many bishops are wrestling with similar downsizing questions as the number of church-going Catholics in parts of the U.S. and Europe shrinks and once-full churches stand empty. Toward that end, the Vatican recently sold the property housing its embassy in Tokyo's high-end Sanbancho neighborhood, near the Imperial Palace, to a developer building a 13-story apartment complex, according to the Kensetsu News trade journal. Yet there has long been institutional reluctance to part with even money-losing properties. Witness the Vatican announcement in 2021 that the cash-strapped Fatebenefratelli Catholic hospital in Rome, run by a religious order, would not be sold. Pope Francis simultaneously created a Vatican fundraising foundation to keep it and other Catholic hospitals afloat. 'They have to come to grips with the fact that they own so much real estate that is not serving the mission of the church,' said Fitzgerald, who built a career in real estate private equity.
Daily Mail
3 hours ago
- Daily Mail
Labor reveals plan to deliver 1.2million new homes
Breaking ground on delivering 1.2million homes starts by untangling the maze of bureaucratic approvals, the federal government says. Housing Minister Clare O'Neil has signalled a second-term Labor administration will move quickly to boost construction. 'We've just been elected with a really clear mandate to improve our housing system in this country,' she told reporters on Saturday. 'We've got big reforms to implement, and not a day to waste in getting on with them.' The minister vowed to simplify local, state and federal planning regulations by leading a council of planning ministers. 'If we are going to address the housing needs of Australians, it is going to require the three levels of government to work together in new ways,' she said. She will work with the building sector to implement innovative technologies to move past time consuming and costly methods of construction. Her comments come after an interview with ABC on Friday where she said 'builders face a ridiculous thicket of red tape that is preventing them building the homes we need.' Master Builders Australia CEO Denita Wawn said the cost of building a home had skyrocketed by 40 per cent over the past five years while construction times had ballooned by 80 per cent over the past decade. 'It is critical that we remove the red tape that is hampering our capacity to build homes,' she said. Ms Wawn was hopeful the ambitious goal of 1.2million homes coming onto the market would be achieved, but said the group's projections showed there could be a slight drop-off. She argued that along with the focus on reducing red tape, there was an urgent need to apprenticeships and fast-tracking migration for skilled people. 'For the first time, the federal government is leaning in and trying to ensure that there is a focused attention on housing,' she said. But opposition housing spokesman Andrew Bragg said the government's plans were a 'joke' and described Labor as 'red tape champions.' 'Labor's signature housing policy, the Housing Australia Future Fund has built zero new homes in three years,' Senator Bragg said. 'Approvals are way down under their watch and their 1.2million new home target is a dead duck.' The Paris-based Organisation for Economic Cooperation and Development warned Australia on Tuesday to boost housing supply and address falling affordability. The OECD said easing zoning restrictions would strengthen competition and productivity, as well as raise housing investment to 'reverse the long-standing decline in housing affordability'.
Glasgow Times
4 hours ago
- Glasgow Times
'For urgent change that's needed, Green voices must be heard'
There are also home truths for the SNP who put a lot into this seat. They tried to be the anti-Reform vote but that didn't work. The immediate reaction of some in the party that they instead need to "hit the independence button" hits home just how little they have to fall back on from their record in government. Greens led a solid grassroots campaign which helped to build profile and support ahead of the Holyrood elections next year, where the proportional voting system means Green votes count more. There are some clear lessons emerging for how Greens need to approach that election. The SNP can't succeed as the anti-Reform vote because they are the political establishment in Scotland that those turning to Reform are hacked off with. It's their cuts to council budgets and their failure to replace the unfair council tax that is responsible for the decline people see in their neighbourhoods. It's their failure to build enough homes or to bring down outrageous rents that are driving the housing crisis. It's their U-turn on climate targets and lack of a proper green industrial strategy that is putting jobs and communities at risk. Greens can put forward a bold manifesto that responds to these things and more. That speaks to real issues facing people, not the bogeymen put forward by Reform. Urgency is vital. Where the SNP is cautious in the extreme, Greens must present a plan to deliver tangible change, quickly. Parties are often pressed on having a costed manifesto. That's important, but I think it's equally so to have a timed plan, not with vague and distant targets, but for real improvement, now. Greens have policies that resonate and are needed, but the biggest barrier we still face is being heard. The BBC Scotland Debate Night programme this week is a clear example of that. The show was a 'Glasgow Special' but it didn't include the Greens, despite being clearly the third political force in the city. Instead, alongside the SNP council leader Susan Aitken, viewers heard from the Tories, who have just one councillor left and are facing being wiped out in Holyrood next year, and shockingly from not one but two Labour representatives (though the show's producers neglected to make the political affiliation of the unelected Baron Haughey of Hutchesontown clear). It's perhaps not a surprise that the BBC won't platform Green voices which challenge the status quo, but it is a real shame. Green representatives are shaping the future of Glasgow, whether that's by working to end rip-off rents, by making our streets and public spaces safer, or by delivering new powers, like the Visitor Levy, which will raise tens of millions more for local services. Greens can deliver the radical and urgent change people want, but to do that Green voices must be heard.
