Treasurer Jim Chalmers defends Labour’s plan to impose taxes on over $3 million in super balances – previously warned that it would deal the biggest blow to young workers.
Labor believes its plan to raise income tax to 30% will only affect 9.5% of the population or 80,000 people – no plans are currently indexed to inflation.
The government also plans to tax unrealized gains that exceed this threshold, meaning retirement savings will be taxed at the nominal value of the asset before it is sold.
Diana Mousina, deputy chief economist at AMP, believes that Labor’s pension will reach an average of 22-year-old workers before retirement, even if the employer’s contribution remains before retirement, even if the employer’s contribution remains persistent by 12%.
She told the Daily Mail that without an index threshold, it would not affect 0.5% of people, which would affect higher populations over more than 40 years. ”
“Even people with average incomes throughout their lives can easily reach this threshold – we won’t make any further contributions to super contributions.”
Jim Chalmers defends lack of indexing
Chalmers defends the Labor plan to impose a new tax on balances of more than $3 million without taxing inflation.
He told Sky News host Peter Stefanovic on Tuesday that he told Sky News host on Tuesday.
Treasurer Jim Chalmers (with Prime Minister Anthony Albanese) plans to impose taxes on super balances of more than $3 million – after warning young workers
“We have many areas in our tax system, thresholds are not indexed, governments change them from time to time, and I hope this happens again.
“It is a strange assumption that no one changes the threshold over the next 30 or 40 years.”
The Treasurer says unrealized taxes already exist
Labor hopes to impose a new 15% unrealized tax on retirement assets above the $3 million threshold.
This means that self-managed superfunds will have to sell assets such as farms or commercial real estate to avoid taxes on the nominal gain.
Before the sale of assets, no other country in the world taxed unrealized income of pensions.
Opposition and Independent Climate 200 MPs, such as Senator David Pocock, expressed concerns about Labor’s 296 tax proposal, which would mark a fundamental difference from the usual practice of capital gains tax once sold.
But Chalmers argued that unrealized gains already apply to super taxes.
“First of all, there are other parts of the pension system in terms of unrealized benefits, which is calculated, and it is a common misconception that is repeated too often,” he said.
Diana Mousina, deputy chief economist at AMP, believes that Labor’s pension will reach an average of 22-year-old workers by the age of 65 and then retire.
The Treasurer did not mention the 293 Tax Department, which has imposed a 15% tax on donations of over $250,000 since July 2012.
If the super contribution exceeds this threshold, it is actually like unrealized gains.
Just as Labor’s 296 proposal balance exceeds $3 million, it is not in inflation either.
Ms Musina said Labor’s proposal to tax unrealized incomes over $3 million is similar to the existing 293rd Division’s rules on super donations.
“This is basically another form of taxation that will affect higher populations,” she said.
Income raising
Labor introduced the Treasury Act Amendment (better pension concessions and other measures) bill in 2023.
This is part of the plan to raise $20 billion a year, otherwise booked revenue, as the 15% super discount rate is still less than $3 million in capital revenue.
“This is still a preferential tax treatment for the people,” Chalmers told state host Sally Sara on Tuesday.
“It has fewer offers. It can help us fund more powerful health insurance or tax cuts or cost of living to help or build more homes. So, this is an important part of our budget. ”
On July 1, mandatory employer super donations rose from 11.5% to 12%.
