A leading economist has called for parliament to pass the government's proposed super tax changes, calling them "much-needed reform".The federal government has proposed doubling the tax on superannuation balances of $3 million and higher, from 15 per cent to 30 per cent.Though slated to begin on July 1 this year, the measure is not yet set in law.
The government has proposed increasing the tax on wealthy super accounts. (iStock)Treasurer Jim Chalmers has claimed that the measure will only apply to about 80,000 people – or 0.5 per cent of super accounts in Australia."This adjustment does not impose a limit on the size of superannuation account balances in the accumulation phase. And it applies to future earnings – it is not retrospective," Chalmers said when unveiling the policy in 2023."This modest adjustment to tax breaks for the biggest accounts is expected to generate revenue of about $2 billion in its first full year of revenue after the election."However, critics say the increase would be an unfair drain on super accounts.Now, The Australia Institute chief economist Greg Jericho said the change would bring balance to Australia's superannuation system."This financial year the richest 10 per cent will receive just over $20 billion in superannuation taxation concessions," Jericho said.Soft skills on the rise as Australia's 15 fastest-growing jobs revealedView Gallery"This at a time when around 23 per cent of Australian retirees end their working lives in poverty, compared to 11.1 per cent in Sweden and 3.8 per cent in Norway."Superannuation tax concessions are designed to encourage people to save and reduce dependency on the age pension, they are not designed to be used by the very wealthiest in society to avoid paying tax."The Australia Institute claimed a small number farmers and small business owners had placed assets such as farms and properties into their super, reducing the amount of tax they paid.
