The Labor government has proposed changes to the tax rates on superannuation balances above $3 million. The changes, which were announced today by Treasurer, would see those with high superannuation balances pay a higher tax rate on their earnings.
Under the proposed changes, those with super balances above $3 million would be subject to a 30% tax rate on their earnings, up from the current tax rate of 15%. The changes are aimed at ensuring that high-income earners pay their fair share of taxes and that the tax system remains progressive.
The Treasurer said that the changes would affect only a small number of Australians, approximately 80,000 people, and that the increased tax revenue generated would be used to fund essential services such as healthcare, education and infrastructure.
“We believe that those who have been fortunate enough to accumulate significant wealth should contribute a little more to support the needs of all Australians,” said the Treasurer in a statement.
The proposed changes have been met with mixed reactions. Some have praised the government’s efforts to increase revenue and redistribute wealth, while others have criticized the proposal as an attack on high-income earners.
The Australian Council of Trade Unions (ACTU) welcomed the proposed changes, stating that they would help to address inequality in the country. “The tax system should be fair and progressive, and these changes are a step in the right direction,” said ACTU President.
However, the opposition party has slammed the proposal, arguing that it would discourage people from saving for retirement and that it could lead to wealthy Australians moving their money offshore.
“The Labor government’s tax grab on superannuation is a cynical attempt to score political points, and it will hurt ordinary Australians who are trying to save for their retirement,” said the Opposition Leader.
The proposed changes will need to be passed by parliament before they can become law. The government has stated that it hopes to implement the changes starting from the 2026 Financial Year.