The changes would double the tax on super balances of $3m and over, from 15% to 30%.
The vast majority of Australians can only dream of retiring with a super balance of $3 million. Most people end their working lives with just a fraction of that.
While the superannuation system has enabled the likes of farmers and small business owners to place assets such as farms and properties into their super, the number of those who do that is small and most – if not all – do so as a way of reducing the amount of tax they pay.
This is not what the superannuation system was designed to do.
In the most recent financial year, the Treasury Department estimated the concessions of superannuation earnings and contributions cost the government $51.7bn in foregone revenue. This compares to the cost of the Age Pension of $58.9b.