After months of vociferous pushback from the superannuation industry and wealthy investors, Treasurer Jim Chalmers has softened his proposed super tax reforms. The move is a pragmatic political compromise – but it also raises questions about policy consistency and long-term fairness.
The revised plan has three key elements:
- a boost to the Low-Income Superannuation Tax Offset. The offset ensures low-income workers don’t pay a higher tax rate on their super contribution than on wages
- a redesigned 30% tax on “future realised earnings” from superannuation balances between A$3 million and $10 million, with a higher 40% tax rate for balances above $10 million.
- the new $3 million and $10 million thresholds will be indexed to inflation.
