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News.com.au
21 hours ago
- Business
- News.com.au
‘Naive': Australians have their say on proposed super tax
Young voters and Labor voters are among those most in favour of the Albanese government's proposed tax concession reductions for people with more than $3m in superannuation. Half of Australian voters (52 per cent) support the proposal, while about one in four (26 per cent) oppose it, YouGov polling on behalf of The Australia Institute has found. Young people aged 18-24 are about four times as likely to support the proposal as oppose it. Female voters are more than twice as likely to support the proposal as oppose it. Only 0.3 per cent of Australians – some 80,000 – have super balances north of $3m. Under the proposed changes, they would pay an additional 15 per cent on yields, which according to Treasury estimates would pump about $2.7bn into Commonwealth coffers. Speaking to NewsWire, The Australia Institute executive director and former chief economist Richard Denniss said he believed it was naive to suggest young voters should be worried about tax concessions for the ultra-wealthy. 'It seems quite ridiculous to suggest that young people who can't afford to buy a house, young people who are worried about all of the pressures of modern life, should be worried about the feelings of much older people with $3m in superannuation,' he said. 'We are in a cost-of living crisis. To suggest that the big concern for most Australian voters, let alone for most young voters is the feelings of people with more than $3m in super paying a little bit more tax. Well, I just think that's naive.' Some critics have decried the proposal as a tax on unrealised gains, with others warning it could penalise younger generations down the track. However, Mr Denniss said these criticisms misinterpreted or overlooked the realities of the situation. 'The simple reality is only 80,000 of the 26 million people in Australia have got more than $3m in super. If someone finished school and started earning the average earnings on the day they finished school and worked for the rest of their life, they still wouldn't get to $3m in superannuation,' he said. 'To suggest that in time, this will be a big deal for all Australians really suggests that people making that argument have no idea what ordinary Australians are dealing with – $3 is an enormous amount of money to have in superannuation and all the government's proposing is that people that are fortunate enough to have that much get slightly smaller tax concessions than they currently do.' Mr Denniss added that it was 'pretty clear' why young people would think 'sure, pay a bit more tax, because I'd like to have access to better quality health, better quality education, and improvements to my cost of living'. The survey also found that half (50 per cent) of Australian voters believe the additional $2.7bn in revenue from these changes would make no difference to their vote at the next election. However, about one in five (19 per cent) indicated that it would make them more likely to vote Labor. Mr Denniss said that of particular interest was the higher proportion of young voters, female voters and independent voters who were more likely to support the reduction. 'It's very high risk for the Liberal Party to so soon after losing young female voters in inner city areas to come out and defend a policy that overwhelmingly helps higher income men,' he said. The survey found nearly three-quarters (72 per cent) of Australian voters see the main purpose of the superannuation system as funding their retirement. More than half (53 per cent) also believe it's there to reduce reliance on the aged pension. 'We're often told that the point of superannuation is to help people fund a dignified retirement and that the benefit of superannuation is that it takes pressure off the age pension budget. This sounds amazing, but in reality in Australia, there are people with half a billion dollars in their self-managed super funds,' Mr Denniss said. 'So unfortunately, superannuation has become a vehicle for tax minimisation for the very wealthiest Australians and giving huge tax breaks to people with half a billion dollars in super does nothing to take pressure off the age pension budget for the simple reason that someone with half a billion dollars was never going to get the age pension. 'We really need to reflect as a country on what is the point of superannuation and what is the goal of giving tax breaks to superannuation? Because giving tax breaks to people who've got half a billion dollars in their self-managed super fund makes no economic sense and it doesn't make a lot of political sense either.' The 18-34 age group showed the highest likelihood of being swayed to vote Labor due to this policy; however, South Australian voters and Coalition supporters were among the most likely to be less supportive of Labor as a result. 'The reality is that people living in the inner cities of Australia are often the highest income earners, so it's not a surprise that we see a lot of people in regional areas and a lot of people in capital cities like Adelaide and Hobart, where incomes are a lot lower than Sydney and Melbourne, are less concerned about this policy than most,' Mr Denniss said. 'But to be clear, even in the inner city, even in NSW, a majority of Australians actually think that this is a good idea.'
ABC News
04-06-2025
- Business
- ABC News
Treasurer Jim Chalmers accuses opponents of 'extremely generous' super tax changes of 'lies'
Treasurer Jim Chalmers has accused critics of his super tax plan of a bad-faith campaign against the "modest" but "meaningful" reform, declaring his intention to pass the new tax into law without amendments. There has been renewed attention since the election on the two-year-old Labor proposal to double the earnings tax on super balances of at least $3 million, from the current 15 per cent to 30 per cent. Critics say the method for applying the tax, which includes "unrealised" growth in the value of assets as taxable, is unfair to those who keep multimillion-dollar homes, farms or paintings in their funds. There is also criticism of the decision not to index the $3 million threshold, which would see it fall in real terms to $2 million in 15 years' time. But Mr Chalmers said he believed those attacks were unfounded, and an excuse for those who wanted to retain "the extremely generous tax concessions, not the slightly less extremely generous tax concessions" he proposes. "People will say it's about the calculations, some people will say it's about the indexation, but in a lot of instances … it's not really," he told reporters on Wednesday. "These changes were announced almost two-and-a-half years ago now; we did multiple rounds of consultations … We provided years of opportunities for people to suggest different ways to calculate that liability and nobody has been able to come up with one." Treasury recommended the unrealised gains approach, owing to feedback from large super funds that it would be difficult to calculate it any other way. "The concessions here are still very generous. We're not eliminating tax concessions for people with big balances, we're still providing very substantial tax breaks, just slightly less substantial," he said. "I think we should resist the temptation to think that because overwhelmingly two media outlets don't like this change, to assume that that concern is kind of broadly and deeply felt in the Australian community." Shadow Treasurer Ted O'Brien made a fresh critique of the policy on Wednesday, saying the proposal was "an absolute disgrace" and would be "a disaster for the Australian economy". Mr O'Brien told The Australian last week he was open to a deal with Labor if it ditched the unrealised gains component and indexed the $3 million threshold. But on Wednesday he said there was "no deal to be had" unless Labor agreed to "lower, simpler and fairer" taxes, a principle seemingly at odds with this tax rise. Labor says the plan would apply to just 80,000 people initially, reducing the size of the tax concession for someone with a $3 million super balance from around $14,000 to around $13,000. Mr Chalmers said the Coalition was not "fair dinkum" about a deal, pointing to apparently contradictory statements from James Paterson and Matt Canavan. While he acknowledged Labor could not pass legislation without either the Greens or the Coalition, he did not signal willingness to move on Greens leader Larissa Waters's alternative proposal of a $2 million threshold with indexation. Labor sources told the ABC the government was not enthusiastic to spend too long talking about the tax, indicating a resolution of some sort was likely. But the treasurer said the episode didn't "augur well for bigger, broader tax reform". "I think that there's an issue here when it comes to tax reform. A lot of people say they're in favour of tax reform in the abstract, but they very rarely if ever support it in the specific." Mr Chalmers also reiterated that those who have "defined benefit" pensions, including federal politicians elected before 2004, would be subject to alternative arrangements to pay an equivalent amount of tax. Defined benefit funds pay out a set amount each year in retirement, different from the normal "defined contribution" funds where the payout is determined by what someone has contributed and earned. That makes an earnings tax difficult to apply, with the workaround to be a tax applied during retirement. The treasurer said that workaround was "consistent with a longstanding approach taken in other areas of superannuation…". "It's a function of necessity, [and] we charge an interest rate on those liabilities to make sure that people don't receive an inappropriate advantage from the necessity," he said. The group of politicians with access to the old defined benefit scheme includes Anthony Albanese, prompting Coalition frontbenchers to accuse Mr Chalmers of planning a "tax break for his boss". The treasurer said the "lower echelons" of the Coalition had been "shamefully" lying about this. "It's been abundantly clear in black and white, and people have lied about it."
