Sam Birrell (Nicholls, National Party) Share this | Hansard source

Like the member for Indi, I represent a farming region. There has been a regrettable attack on agriculture by this government. We've seen it in many ways in the last few weeks, and in the previous few years as well. It's something I'm very concerned about. I don't think people on the opposite side understand agriculture, I don't think they understand how agricultural businesses work, and I don't think they understand the importance of agriculture to Australia's economy, and that is absolutely regrettable. This legislation, the Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill 2023 and a related bill, is an example of that. It's not the only thing, but it's a key reason I've got some serious concerns about this piece of legislation. Labor's superannuation changes are set to disproportionately impact family farms held in self-managed super funds if they exceed new thresholds. Let's face it: this legislation is just a superannuation tax grab that will allow Labor to tax unrealised capital gains on self-managed super fund held farms across regional and rural Australia. The very real danger is that farmers may not have the cash flow to pay the tax on the unrealised capital value in their property that was part of that self-managed super fund. The general concept of taxing an unrealised capital gain is a flawed piece of policy. It's a first in Australian superannuation policy, and it has the potential to create cashflow issues for taxpayers. It is absolutely unreasonable for people to fund a tax liability for an asset that has gone up in value while they have not sold the asset and received the money with which to pay the tax. That just doesn't make any sense, and anyone who's run a business or worked in private enterprise should understand that.

Taxing unrealised capital gains exposes superannuants to market volatility, and they'll be worse off if the value of their investments has significantly declined when it comes time to sell. Taxing unrealised capital gains denies the benefits of compounding, which is critical to good retirement outcomes. Compounding was what superannuation was all about. When what I would regard as a competent Hawke-Keating Labor government—I think that was probably an aberration—first put in superannuation, the compounding effect was the key part of it, and many people have managed to have a dignified retirement, including people in my family, as a result of the changes that were put in, and I congratulate that government for that. But to start trying to raid it the way the current Labor government is—a very different government to the Hawke-Keating government, I might add—is just not on. This tax will reduce investment, because superannuants will direct investments to less volatile financial products.

Now, for those opposite, who, by their constant legislating of policies that are anti-farming and have perverse and detrimental impacts in the regions, let me explain how farming works in many cases. Many families and farm owners, including the wonderful fruitgrowers, vegetable growers, and dairy farmers in the seat of Nicholls, have set up self-managed super funds as their future retirement savings. It's good financial practice. But these people did so unaware that a Labor government was going to get in and come for their assets with more taxes. As many people understand—including the member for Dawson, who has been a farmer, and myself, who has worked in farm management—farming is a risk-reward business. But the reward is not guaranteed. Returns fluctuate. In a bad season the return might be just enough for a cropping farmer to buy seed in order to take the same risk the next season and plant a crop—and bless the people who have the guts to do that in Australia's interest. Often there's no return.

I've had some fruitgrowers in Nicholls, growing clean, healthy Australian fruit, and I've talked about them in the past and about what they do for this country and what they do to make sure that there's a great, healthy Australian product for our children—the risk they take for that. Some of them have been hit by hailstorms two years in a row. That's pretty tough, because you lose a crop. Not only do you lose a crop, but sometimes the hailstorm is so severe that you can get reduced yields in the years succeeding that. The previous coalition government sought to look after those industries through a subsidy on hail netting. It's one of the practical things the coalition government has done, back when we had a government that looked after farmers. The farmers are working through that, but they haven't got the money to do it all, so some of them have lost significant amounts of crop from hailstorms.

Taxing unrealised paper assets in agriculture when the cash flow is seasonally dependent is setting a dangerous precedent. It's bad policy and, like so many policies from the government, it's going to have adverse consequences for regional businesses. And it attacks productive industry. This is what I've been going on about. Since the budget was delivered the other night—and it's got a lot of anti-agriculture stuff; it's also got a bit of anti-mining stuff in it—it really does redirect industry support away from what we've been good at in the past, that is, agriculture, and directs funds towards things that are more ideologically attractive to the current Labor government. It really makes it more difficult for people to do the things that have grown Australia's wealth. And one of the key things that has grown Australia's wealth has been agriculture—so incredibly, effectively done in the seat of Nicholls. You can see probably why they want to do it. In 2027-28, the first full year of receipts collection, the measure is expected to increase receipts by $2.3 billion. An extra 15 per cent tax rate, from 15 per cent to 30 per cent, will be applied on the earnings of super accounts worth more than $3 million.

There has been a lot of feedback from concerned industry and farming groups, but the government has ignored that. A good government listens to stakeholder groups, because a good government understands that MPs and people who work for departments in Canberra don't know everything. It may come as a shock, but they don't know everything. When you get out there and talk to the people who have taken the risk and run the farms, run the mines and work in private industry, you get a really good perspective and you get better policy outcomes—newsflash.

The government has ignored the feedback from concerned industry and farming groups and is pushing the legislation through, despite not being able to identify, with its Treasury modelling, how many primary producers or family business owners would be impacted. The Assistant Treasurer and Minister for Financial Services said, in his second reading speech, that this bill 'ensures that concessions are better targeted at amounts that deliver income for a dignified retirement'. Actually there's no change to the tax rate for amounts that deliver a dignified retirement. All it delivers is higher taxes for those with larger superannuation accounts.

Everyone knows I'm a first-term MP. I've enjoyed watching question time, because there have been a lot of interesting precedents that I've noticed in question time. One of the most interesting question times I've sat through was when the Assistant Treasurer and Minister for Financial Services was asked questions about how this policy would roll out and what would be some of the consequences. What happens if the unrealised capital gains fluctuate either side of $3 million? Does a farmer have to sell part of their land to try and pay the tax bill, even if they've had a bad year? The minister could not answer those questions, and it's the first time ever I've seen the opposition leader get up and offer him another three minutes to have another go. I think that that proves that this legislation was undercooked then, and I've seen nothing, since reading it, that suggests to me that it's not undercooked now.

What will Labor do with the additional $950 million that they collect over the five years from 2022-23? Take your pick of the greatest hits: more destructive policies like the excessively rapid transition to renewable energy, which is damaging landscapes in parts of regional Australia, including my electorate of Nicholls; vehicle emissions targets that'll make it harder for farmers and people for whom electric vehicles aren't appropriate to buy the vehicles that they need; or funding—and this is the worst bit—of destructive water buybacks. I think I've been pretty vocal in this place about water buybacks in the Murray-Darling Basin. I believe there could be some pretty unpleasant stuff once we start trawling through the budget papers, but really, talk about productivity. It is one of the most productive food bowls anywhere in the world, and you want to take away what makes it productive—unbelievable!

Labor's broken promise on super is a tax on the future of young Australians. I've focused a lot on the attack-on-agriculture component of this, but the next generation of Australian workers will be hugely impacted by Labor's extra tax take on superannuation accounts. This is because of the absence of indexing. It will compound the number of young workers captured over time by this tax. These tax hikes, which Labor promised it wouldn't impose, will affect so many people. Okay, in the sort of rich-poor class culture war that we have in this country, where you want to steal from the rich and give to the poor because you want to make a bit of a hero of yourself, $3 million is a lot of money. I don't mind that some people have worked very hard to build up assets to get that $3 million in superannuation. But the point is, because it's not indexed and because CPI is rising faster than it should have—and let's hope inflation gets under control, but with this budget I don't like the chances—it means that so many more people are going to be captured with superannuation balances of $3 million into the future. A young person now who's worked pretty hard—who knows? they might be in their 30s—might have a superannuation balance that's ticking on $600,000 or $700,000. If they keep working hard, as we want them to, if they keep earning more money, as we want them to, and if they keep their aspirations, as we're desperate for them to for this country's future, their superannuation balance is going to tick upwards of $3 million—and that's not going to be a huge amount of money in 20 years—and all of a sudden they'll be hit with a massive tax, because they did what we asked them to do. That's not the way an Australia that encourages aspiration should operate. This will have serious impacts on young Australians in the future and it will have serious impacts in regional Australia.

As usual, there are some consequential changes that are positive. The Commissioner of the Australian Charities and Not-for-profits Commission will be able to make disclosures about new and ongoing investigations where the disclosure would prevent or minimise the risk of significant harm. There's always something good in a bad bill, so people have got something to talk about—that's what I've noticed in my new parliamentary career. But it doesn't matter how many pretty ribbons you use to tie this up. This package has at its core a broken promise, because they said they weren't going to touch super, and a new and unfair tax. It's an attack on agriculture and an attack on the aspirations of young Australians, and I won't be supporting this bill.

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