Labor rules out imposing superannuation balance limits

Shadow Treasurer Jim Chalmers has ruled out putting a limit on superannuation balances or imposing an earnings tax on members’ retirement phase if Labor is elected, following industry calls to address extremely large balances. 

Earlier this year, the Australian Institute for Superannuation Trustees (AIST) called for a $5 million superannuation balance cap while in 2020, the Self-Managed Superannuation Fund (SMSF) Association  urged the Government to review extremely large balances in the Retirement Income Review.  

Speaking at a Financial Services Council industry event, Shadow Treasurer, Jim Chalmers, said his party would not replicate the same superannuation policy agenda it took to the last election. 

“We had a whole agenda on tax in 2019 and we’ve said, probably 100 times now since then, we won’t have exactly the same agenda on tax that we had at the last election,” Chalmers said. 

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“Everybody assumes that is entirely for political reasons, obviously we heard a political message from that election but it’s also because our priorities are elsewhere.” 

Chalmers said the last three years of economic disruption had shown that governments only had “a certain amount of space to make meaningful change”. 

SMSF Association chief executive, John Maroney, welcomed Chalmers’ announcement that Labor would not bring in any new superannuation taxes or balance caps to the election. 

“Constant changes to the superannuation tax settings erodes confidence in the superannuation system and discourages members from making long-term savings plans,” Maroney said. 

“With both sides of politics seemingly having ruled out making major changes to the superannuation tax settings as part of their election proposals, superannuation members can confidently focus on managing their financial needs rather than being forced to consider significant changes to their retirement plans as the election looms.” 

Chalmers said his party would instead focus on core policy items such as cleaner and cheaper energy, skills, a modernised National Broadband Network, and greater productivity. 

Though Chalmers was vocal on supporting a global effort to change the way multi-national corporations were taxed and reforming state tax arrangements.