Greens Secure Passage of Super Tax Changes, Demand Broader Reform
The Greens have agreed to support Labor's revised superannuation tax package in the Senate, guaranteeing its passage into law and ending a three-year political battle over concessions for wealthier retirees. Greens treasury spokesperson Nick McKim framed the decision as a "down payment" on Labor pursuing more ambitious tax reforms in the upcoming 12 May federal budget.
Senate Numbers Present Opportunity for Bold Action
McKim emphasized that the political landscape favors significant reform, stating, "There is a massive Labor majority in the House of Representatives, the opposition is a rabble, and the numbers are there in the Senate as long as Labor shows courage. The only limit is Labor's level of ambition." He urged the government to scale back the capital gains tax discount and negative gearing to address housing inequality.
Details of the Superannuation Tax Adjustments
Under the legislation, the concessional tax rate on earnings for super balances between $3 million and $10 million will double from 15% to 30%. Balances exceeding $10 million will face a new, higher rate of 40%. The government has also indexed the $3 million and $10 million thresholds to inflation and increased the low-income superannuation tax offset by $310 to $810, raising the eligibility threshold from $37,000 to $45,000 starting 1 July 2027.
Revised Package Addresses Previous Criticisms
Prime Minister Anthony Albanese and Treasurer Jim Chalmers first announced "modest" changes targeting large super balances three years ago. After failing to pass the legislation in its first term, the government faced criticism over taxing unrealised capital gains. In October, Chalmers removed that contentious element and added inflation indexing, which the Greens initially criticized as a "capitulation to the wealthiest people in the country."
Greens Opt for Cooperation Over Hardball Tactics
Despite the Coalition's opposition, which made the Greens Labor's only hope for Senate passage, the minor party decided against demanding concessions in exchange for support. McKim described the current tax system as having "turbo-charged the housing crisis, wealth inequality and a deepening intergenerational divide," and called for reforms to create a fairer society for young and working people.
Budget Seen as Pivotal Moment for Progressive Reform
McKim declared the upcoming budget a "once-in-a-generation opportunity for ambitious tax reform," and stated, "We are opening the door for Labor to walk through. Labor is standing in front of an open goal – if they bring reform that would rein in spiralling inequality and the housing crisis, they will have the Greens' support to get it done. The only obstacle to real change is Labor." The government is reportedly considering measures such as winding back the 50% capital gains tax discount and potentially capping negatively geared properties to tackle housing market inequality.
