Real number of Aussies hit by super tax
Labor MP and Assistant Minister for Foreign Affairs and Trade Matt Thistlethwaite was pressed over the Albanese government's proposal to roll back concessions on ultra-high super balances and tax unrealised gains that would penalise younger generations in the future.
The plan, one of the government's key economic policies, will hit those with more than $3m in their superannuation accounts with an extra 15 per cent tax – initially forecast to be about 80,000 people by 2025-26 – on top of the 15 per cent all super fund members are taxed on their earnings.
That number has now jumped to up to 1.2 million Australians, significantly more than the original figure.
'1.2 million Australians in the long run – that's not the small amount you've all been saying,' Sky News' Pete Stefanovic questioned Mr Thistlethwaite on Monday morning. Matt Thistlethwaite said the proposal was to ensure 'fairness and equity' in the Australian taxation system. NCA NewsWire / Martin Ollman Credit: News Corp Australia
'Well, this is a policy … that's aimed at ensuring that we got fairness and equity in our taxation system,' Mr Thistlewaite began, before being cut off swiftly by Stefanovic: 'How's that fair if the PM gets a pass?'
The proposal has come under fire for the inclusion of 'special rules' that would exempt Anthony Albanese until after the Prime Minister retires.
Mr Thistlewaite continued: 'Everyone who's on a defined benefit scheme will be treated the same. That's the basis of it.
'Regardless of your occupation, where you live, (everyone) will all pay the same … at the moment, some people can divert money from income to avoid paying income taxation into superannuation to get a concessional rate.
'Now the average teacher, the average childcare worker or emergency services worker can't do that, so we just want to make sure that the system is fair and equitable, and everyone pays their fair share of tax.'
The $3m figure will not be indexed, leaving about 1.2 million people within 30 years liable for the tax, Assistant Treasurer Daniel Mulino revealed last month.
Liberal senator Hollie Hughes accused the government of not considering the 'unintended consequences'. Liberal senator Hollie Hughes accused the government of not considering 'unintended consequences'. NCA NewsWire / Martin Ollman Credit: News Corp Australia
'I had dinner with a small-business owner last week whose office building is part of a superannuation plan, and her message to me was incredibly clear that if this goes ahead she does not know what she can do because this is something that the business is invested in, she's invested in,' Senator Hughes said.
'It's her business, and now, because of the increase in property prices she doesn't know if she can afford to pay a tax on an unrealised gain.'
She said the tax would come 'knocking on the doors' of everyday Australians, especially small business owners and farmers.
Questioned again about the confirmed number of Australians to be impacted by the tax, Mr Thistlethwaite said: 'Initially, it's a very small it's a very small number of Australians, less than 0.5 per cent of the population. Treasurer Jim Chalmers was accused of writing 'special rules' that exempt Prime Minister Anthony Albanese from Labor's super tax. NewsWire / Martin Ollman Credit: News Corp Australia
'I think we got to realise we're only talking about (balances) above $3m, and we're talking about something that hasn't been legislated yet, but at the moment people have the choice.
'They can pay their income tax or they can divert it into superannuation to get a concession.'
He said the Labor government would 'work' with the opposition if it were prepared to be 'fair and reasonable'.
The tax is proposed to take effect from the start of the next financial year, July 1.
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