Hidden victims of $3m super tax

Perth Now

11-07-2025

Australian farmers are shaping up as the hidden victims of Labor's proposed $3m superannuation tax.
The tax has been dubbed a bill for the ultra-wealthy, and The Australian National University has run the numbers on who will be impacted and how many Australians can pay it back.
While the usual list of Australian chief executives, business professionals and senior managers are estimated to be slugged this new tax, one group stands out from the pack.
Australian farmers, due to the values of their farms and the expensive equipment needed to run them, will likely be asked to pay a little more to the taxman. Farmers will be slugged more in taxes due to the expensive land and machinery costs that will be part of the unrealised gains. NewsWire / Nadir Kinani Credit: News Corp Australia
Nationals leader David Littleproud previously said it was an unfair tax on Australian farmers.
'What happens is that people who are caught up in this are going to try whatever they can to get themselves out of it,' he told Sky News in June.
'And when you think about farmers, they've bought large capital assets costing millions of dollars and look to actually pass that on to their kids through succession through their superannuation fund.'
Mr Littleproud said Australia needed more young people seeing farming as a career instead of discouraging the work through taxes.
'What's going to happen is that you can have farmers that have tens of millions of dollars worth of property in their self-managed super fund, they pay a rent back to that every year,' he continued.
'But if there's no crop, if they spend hundreds of thousands of dollars on a crop and then the rain stops, they have no cash flow to pay the tax.
'And so what they're doing now is they're going to have to get it revalued and all get revalued every year. Nationals leader David Littleproud called it an unfair tax on farmers NewsWire / Nadir Kinani Credit: News Corp Australia
'There could be hundreds of thousands of dollars every year just in valuation costs.'
In a proposed change to superannuation taxes, the Albanese government plans to raise earnings tax on superannuation balances above $3m to 30 per cent, up from 15 per cent.
The government also plans on taxing unrealised gains as part of these figures.
This will still mean Australians are paying less tax on their superannuation compared with income tax rates.
ANU Associate Professor Ben Phillips and researcher Richard Webster found doctors, business professionals, senior managers, farmers and engineers were the most likely to pay the new 30 per cent tax on earnings on balances more than $3m, including unrealised gains.
According to the figures, the median total wealth for these Australians is more than $11m, with about 87,000 people set to pay the taxes in 2025-2026.
This is about 7000 more than initially forecasted by the government.
It also shows the majority of Australians will be fine paying the additional tax burden, with just 500 or 0.6 per cent of households facing financial difficulty in funding the extra liability.
'Stress testing suggests most of these households faced with an increased taxation burden as proposed by the government would have ample funds to cover most reasonable scenarios,' Professor Phillips and Mr Webster said.
Using the example of a person with a $4m superannuation balance who posts a 10 per cent increase in value to $4.4 million over the 12 months, the researchers show the taxpayer would face an extra tax liability of $19,091.