- Treasurer refusing to negotiate with Coalition over super
Treasurer Jim Chalmers has strongly hinted that Labor will not negotiate with the Opposition on its plans to tax superannuation balances above $3million – despite assurances from Anthony Albanese the government would do so.
The federal government wants to double earnings taxes to 30 per cent for the top 0.5 per cent of retirement savers in a bid to raise $2.3billion a year in revenue.
The Coalition has confirmed it would consider voting in favour of that policy provided the government dropped plans to slap a new 15 per cent tax on unrealised gains on balances above $3million.
Under that plan, super balances above $3million which have appreciated in value could be taxed even before they’re accessed.
But the government does not need the Opposition’s approval as it has the numbers to get any bill through the Senate with the help of the Greens and crossbenchers, and Chalmers has told 7.30 host Sarah Ferguson the government would prefer to deal with the Greens than the Coalition.
‘I’m not convinced that they’re fair dinkum when it comes to making superannuation tax concessions a little bit fairer, and I think my opposite number has made that clear that they’re not interested in that,’ he said.
‘We’ll obviously have discussions with other parties in the Senate to do what we can to pass that legislation.’
This refusal to negotiate with the Opposition was made despite Albanese this week saying the government would negotiate with the Coalition over super policy.
Treasurer Jim Chalmers has strongly hinted that Labor won’t compromise with the Opposition to increase taxes on super balances above $3million
‘We do not have a majority in the Senate; we obviously work with different parties,’ the Prime Minister said.
While Labor has a landslide majority in the House of Representatives, it needs the support of 10 other senators to get any legislation passed through the upper house.
The Greens are enthusiastic about the proposed tax, and in fact want it to kick it on balances of $2million and above, not $3million.
Crossbencher senators David Pocock and Jacqui Lambie last year refused to support Labor’s plan to tax unrealised gains, meaning the government could only rely on the Greens in the Senate.
Shadow treasurer Ted O’Brien this week said the Coalition would be open to negotiating with the government on super provided it dropped plans to tax unrealised gains and indexed the $3million threshold.
‘When it comes to all policies, including this one, the Coalition will always be open however that doesn’t mean a blank cheque,’ he told Sky News.
‘If indeed, Jim Chalmers wants to come and have a discussion with the Coalition about his super tax, he would have to firstly walk away from the unrealised capital gains component, at least.
‘He should be compromising on indexation. Now, if he caves in on all of those things and wants to talk about super reform, let’s have a chat about super reform.’
The Coalition has confirmed it would consider passing Labor’s superannuation policy provided it dropped a plan to slap a new 15 per cent tax on unrealised gains on balances above $3million
But Chalmers argued his Coalition counterpart had kept on changing his position.
‘I’ve seen the comments that they’ve been making publicly, including, I think my opposite number said today that they weren’t interested in negotiating,’ he said.
‘He’s disagreed with himself. He had a different view yesterday or the day before.’
While Parliament is unlikely to sit again until next month, Labor is hoping to pass the Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill and have it backdated to July 1.
Accountants argue taxing unrealised gains would stop self-managed super funds from investing in assets that can quickly appreciate in value, such as technology start-ups; starving that sector of funds.
AMP calculated that refusing to index the $3million threshold for inflation would see the average 22-year-old worker today subject to the tax in four decades’ time, even if compulsory employer super contributions stayed constant.
They are rising to 12 per cent on July 1, up from 11.5 per cent.
