Stephen Jones (Whitlam, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I thank the member for North Sydney for her ongoing and good-faith engagement on this issue and on a range of other issues around the Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill 2023. I know that she's bringing the propositions that she's bringing in good faith and that they reflect representations that have been made to her by members of her community. We won't be supporting the amendments, and I'd just like to point out, in very brief terms, why.

Firstly, a matter of context: the average balance on retirement today is somewhere between $150,000 and $200,000. That's a long way south of the $3 million threshold that has been set in the bill before the House. It's for that reason that we're confident that less than 0.5 per cent of all fund members will be caught by the new provision—about 80,000 people, on introduction—and we don't see any significant shift in that in the near term.

It is of course the norm within the taxation system that we do not index tax thresholds. For example, we don't index personal income tax thresholds. Indeed, the previous government didn't index the division 293 tax threshold when it introduced those changes about a decade ago. It is of course open to a future government to decide to lift the threshold, and a future government would make that decision in the context of all the other fiscal pressures that are bearing upon a government at that point in time.

It's a modest change. It's a change that won't impact more than 99.5 per cent of all taxpayers. And let us not forget the objective of this. It's about ensuring that the taxation arrangements in relation to superannuation—which are generous—are sustainable over time. Even at the higher threshold of 30 per cent, for that portion of a fund over $3 million, that is still an incredibly concessional rate of taxation. So, we think the bill strikes the right balance in ensuring that people are encouraged to save for their retirement. It puts no cap on the amount of money people can have within their superannuation account. If they want to have more than $3 million in their superannuation they can do so, but there will be a higher rate of taxation on that part of the balance over $3 million—still a very generous tax concession for that portion of the fund balance over $3 million. I fully expect that the very small number of Australians who are caught by this will continue to decide to invest their money through the superannuation system because of those generous taxation concessions.

For these reasons, while I accept that the arguments are put in good faith by the member for North Sydney, the government won't be accepting the amendments.

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