Friends in high places: Treasurer finds unlikely ally in super tax stoush
The boss of one of Australia’s big four banks has backed in Labor’s proposed tax hike on superannuation.
The Albanese Government plans to lift the tax rate on earnings for superannuation balances over $3 million from 15 per cent to 30 per cent from mid-2025.
It will impact about 80,000 Australians and is expected to raise $2 billion in the first full year and $3.2 billion over five years, which will go towards balancing the federal budget rather than being spent.
NAB chief Ross McEwan said $3 million was āa lot of money to have in a super fundā.
āIām sure Iāll put myself out there and people will say, āHe should never have said thatā,ā McEwan told ABC radio on Friday.
āBut I think $3 million is a lot of money.ā
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He said the decision would not impact 99.5 per cent of Australians.
āIt will affect a small group of people who had a huge amount of money in those funds ā Iām sure theyāll find other things to do with it,ā he said.
āSo thatās just a reality of where we are. Weāre all going to have to play our part to get this economy back into shape, and get the debt down.ā
Opposition Leader Peter Dutton, whose coalition would repeal the changes in government, said the lack of indexation meant a 25 year old worker today would face a cap of about $1.2 million.
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āThe governmentās making it up on the run,ā he told Nineās Today show.
Deputy Prime Minister Richard Marles said it was an important change to make the system sustainable.
āWe inherited a budget from Peter and his crew, which was a trillion dollars in debt and there was nothing to show for it and we need to be responsible and thatās what weāre trying to do,ā Marles said.
Meanwhile, there are warnings owners of small to medium sized businesses could be adversely impacted by the change.
RSM Australiaās director of financial services, Grace Bacon, said many people managed their superannuation within their business structure.
āATO data shows that more than one-fifth of Australiaās self-managed super funds (as of 2020/21) sit in the $1-2 million asset range and itās not hard to see growth in the value of their property or assets flipping many of these above the $3 million cap,ā she said.
āThis includes farmers, and suburban and regional SMEs ā asset-rich, cash-poor in many cases ā who have commercial property in their self-managed super funds which they rent for their businesses.ā
But she said it was important people did not rush to make changes to their super until the government completed its consultation period and released the final legislation.
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