Wendy Askew (Tasmania, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. Given that Labor's new doubling of the super tax will see earnings in some superannuation accounts paying twice the tax rate that currently applies, will there be any changes to the tax rates applied to those accounts when they are distributed following an account holder's death?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I welcome the opportunity to talk about the government's policy, which—

Opposition Senators:

Opposition senators interjecting—

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I will answer the question, so hold your horses. I'm not wasting time here. It's an important question, and I'm making sure that I get the answer exactly correct for you.

I do my homework, Senator Scarr. But I welcome the opportunity to talk about this very modest change that we are making to the arrangements for superannuation, for those on higher incomes, $3 million or more, raising a modest $2 billion once fully operational in three years time. I would make the point that those opposite have failed to understand, which is that, at the moment, the budget is in structural deficit. We are borrowing to keep services going. And we are saying that it's not fair to borrow more—

Sue Lines (President) Share this | Link to this | Hansard source

Minister, please resume your seat. Senator Askew?

Wendy Askew (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I have a point of order on relevance. I did ask specifically about in the case of death.

Sue Lines (President) Share this | Link to this | Hansard source

I'll direct the minister to the question.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Thank you. But to finish that point—and I will come to the issue that was raised by Senator Askew—Senator Askew and those opposite, the 'no-alition', are arguing that others with much lower superannuation balances should be paying the interest on the debt that we are borrowing to keep the services of government going, rather than make this modest change for those that are fortunate enough to have $3 million and more in their accounts, an average of $5.8 million. Generally, death benefits are able to be withdrawn from the superannuation system. Members will have this option so they do not face additional tax.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Askew, a first supplementary?

Wendy Askew (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Will Labor's new doubling of the super tax mean that a widow or widower would be penalised with a higher tax rate if the retention of their late spouse's superannuation within superannuation saw their savings now exceed Labor's new and unindexed threshold?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The death benefit will not count as earnings in the year that it is received by the surviving spouse.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Askew, a second supplementary?

Wendy Askew (Tasmania, Liberal Party) Share this | Link to this | Hansard source

How is the application on deceased estates of Labor's new doubling of the super tax, which Mr Albanese promised not to do, anything other than a creeping march towards new forms of death duties that penalise Australians at their most vulnerable time?

Hon. Senators:

Honourable senators interjecting—

The:

Order across the chamber! I have the minister on her feet waiting to answer the question.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

That's a classic example of not being able to amend your final question based on the answers to the first two. I would say, for those that are arguing to maintain these arrangements, these concessional arrangements, which will remain concessional for the 0.5 per cent who are fortunate enough to have more than $3 million in their superannuation account to contribute or to have less concessional arrangements in place that contribute to budget repair, that is your core group now, the 0.5 per cent who are in that.

When we have a look—just remember those words of robodebt: 'We will find you. We will track you down and you will have to repay those debts, and you may end up in prison.' That is the approach you took to budget repair.