Wealthy superannuants win as Chalmers caves. What’s the scam?

Chancellor of the Exchequer Jim Chalmers has announced that Labor is backing down on its proposal to tighten the super tax on the very rich. What is fraud?

The fraud is that the Labor Government has allowed hyperbole and hysteria to stall even minor tax reforms.

The original proposal was to ensure that those with self-managed super funds worth more than $3 million (less than 0.5% of superannuation holders) would pay tax on some capital gains of their funds even if they were not realized (when assets were sold). When announced in February 2024, the Treasury said the changes would “make the system fairer” and deliver a $2.5 billion increase in annual tax revenue.

The additional 15% tax (30% in total) was not a measure that would have a significant impact on those affected, but it did cause major uproar. Outlandish claims have been made, ranging from “productivity is a killer” to “investment in start-ups is disappearing” to “farmers not being able to pass on their farms to future generations”.

The changes announced today mean that the $3 million threshold will now be indexed and the additional threshold will be set at $10 million with a 40% tax rate. The more significant change means that unrealized gains will no longer be included in the tax calculation; This means that tax revenue from the changes will be much less than originally anticipated.

‘Better targeted’: Labor fixers on big super accounts

Greg Jericho, Chief Economist at the Australia Institute, said: MWM, “These changes do little to rein in the huge inequality in the pension tax system. Today’s government decision

It will encourage those who favor a tax system that favors the rich.

We debunk the top five myths about the new super tax