‘Special regulation making power': Liberal senator Andrew Bragg expresses concern over Treasurer Jim Chalmers' power to set PM's pension tax rules
Liberal Senator Andrew Bragg has sounded the alarm on Treasurer Jim Chalmers' 'special regulation making power' to determine tax and pension arrangements for Prime Minister Anthony Albanese.
The criticism comes amid scrutiny of the Albanese government's superannuation tax which will tax unrealised capital gains on balances above $3 million.
Mr Bragg told Sky News Sunday Agenda the legislation has left the door open for post-legislative changes that could shield Mr Albanese from the tax.
'If (Mr Chalmers is) serious, he should put the Prime Minister's pension and tax arrangements into the bill before the Senate,' Mr Bragg said.
'Otherwise it's a massive conflict of interest where effectively he would be setting the Prime Minister's pension arrangements subsequent to the bill passing the senate.'
Sky News Sunday Agenda recently revealed that state politicians on the old pension scheme will be exempt from the tax due to constitutional limitations.
The bill has drawn criticism for its inclusion of unrealised capital gains, lack of indexation, and absence of explicit provisions regarding defined benefit schemes.
While Mr Chalmers has insisted publicly that federal politicians will be captured by the tax, Mr Bragg said these assurances are insufficient without statutory backing.
'He has given himself a regulation making power where he will set the Prime Minister's tax and pension arrangements after the bill has passed the Senate,' he said.
'Now if he's serious about applying it to the Prime Minister, he will put the parliamentary scheme into the bill.'
Pressed about the basis for his claims—given Mr Chalmers has assured the Prime Minister will be included—Mr Bragg argued the issue stems from legislative omission.
'He (Mr Chalmers) should be able to say how much the PM will be paying in the first year of his pension,' he said.
'I mean, it's not good enough for him to say, 'We have no idea how much the PM's pension will be'.
'He has actuaries working for the Treasury who could do these calculations for him. This is a massive integrity issue.'
The superannuation tax, which the government claims will affect fewer than 0.5 per cent of superannuants initially, has been projected to raise $40 billion over a decade.
However, critics warn that the unindexed $3 million threshold will subject increasing numbers of Australians to the tax over time.
Despite Labor's insistence that the policy is targeted and fair, critics have slammed the inclusion of unrealised gains and the lack of indexation.
Shadow finance minister Jane Hume told Sky News that the tax had been 'bad from day one'—when it was introduced two years ago.
'While the government says it only affects a small number of people, it's actually going to affect more and more and every year,' she said.
The $3 million threshold has not been indexed, meaning it will gradually drag more taxpayers into the tax net over time.
Treasury modelling estimates that one in ten taxpayers will breach the threshold within 30 years if no changes are made.
But AMP Deputy Chief Economist Diana Mousina has warned that a typical 22-year-old entering the workforce today could be hit by the tax by the time they retire.
CPA Australia's Superannuation Lead, Richard Webb, called on policymakers to ensure the policy will be indexed to inflation.
'Bracket creep is already having a silent eroding effect on personal finances,' Mr Webb said in a statement.
'Allowing this further erosion of superannuation savings is contrary to the fundamental principles of our tax system.'
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