More than 100,000 highly superpowered Australians will be the big losers if Labor is forced to form a minority government with the Greens after the next election, as the polls likely suggest.
Treasurer Jim Chalmers has indicated that Labor is unwilling to negotiate with the left-wing minor party over its plan to double premium tax on pension balances above $3 million to 30 percent.
But should Labor lose its majority at the next election, it could be forced to rely on the Greens to form a minority government.
Labor says the plan will only affect the top 0.5 percent of super savers, or 80,000 people, from July 2025.
However, the Greens want the threshold to be set at $1.9 million instead of $3 million for accrued retirement accounts.
According to their own estimates, based on tax authorities data, this would affect 104,141 people, or 0.6 percent of the population.
Greens members of the Senate economics committee made their position clear in a dissenting report on Labour’s Better Targeted Superannuation Concessions and Other Measures Bill 2023.
“Australia’s superannuation system is no longer about ensuring a dignified retirement for workers,” they said in May 2024.
More than 100,000 Australians will be the big losers if Labor is forced to form a minority government with the Greens after the next election (pictured left: Greens leader Adam Bandt with his wife Claudia)
‘Successive parliaments have distorted its purpose so that it is now Australia’s leading tax haven for wealth building and estate planning.’
Senator Nick McKim, the Greens’ finance and “economic justice” spokesperson, recommended higher taxes on super “by abolishing and reducing all tax systems that disproportionately benefit the highest income earners and asset owners.”
He argued they should be punished because 0.6 percent of people own 14 percent of Australian super.
‘Not only is the legislation narrowly applied to not even covering all of the 100th wealth owners in the country, it also fails to address the multitude of avenues that the current pension system provides for high-income and high-income individuals wealth, at the expense of everyday working Australians,” said Senator McKim.
Labour’s policy of imposing a 30 percent tax on super income above $3 million is so radical that it includes a tax on ‘unrealized profits’.
This would see self-managed super funds taxed on assets someone owned before they were even sold – a departure from usual tax practice.
No other country in the world has applied this policy to retirement savings and could see self-managed funds forced to sell assets such as real estate or farms to avoid higher taxes.
The last time Labor was forced to form a minority government with the Greens was in 2010, when Prime Minister Julia Gillard capitulated and introduced a carbon tax, despite promising not to do so during the campaign.
Treasurer Jim Chalmers has indicated that Labor is unwilling to negotiate with the left-wing minor party over its plan to double contributions tax on pension balances above $3 million to 30 percent (he is pictured in the foreground with Prime Minister Anthony Albanese)
Former independent MP Tony Windsor, who backed Labor to form a minority government in 2010, said a hung parliament in the lower house was the most likely outcome of the next election, due in May next year.
“It will probably be a minority government,” he told Daily Mail Australia.
“It’s more likely: anything can happen.”
Windsor said the Greens and Blue-Green MPs are likely to demand some policy concessions in a hung parliament, most likely from a minority Labor government.
“They will have some power,” he said.
‘There is no doubt that the crossbench will have some influence; in my opinion it will probably be a good thing.
‘You can’t just ram a foolish idea through the House, because it forms a kind of wedge between the others.’
Independent Allegra Spender, who is against taxing unrealized profits, has indicated she is open to forming a minority government with the coalition led by Peter Dutton.
Independent Allegra Spender, who opposes unrealized tax profits, has indicated she is open to forming a minority within the coalition led by Peter Dutton.
“I am deeply opposed to taxing unrealized profits and that is why I am tabling a number of amendments,” she said in October.
“While I am open to taxing large super balances, I think taxing unrealized gains is extremely problematic.”
Fellow Teal independents such as Monique Ryan, Zoe Daniel, Zali Steggall, Sophie Scamps and Kate Chaney represent wealthy voters who would oppose the tax grab on super, while super tax critic Kylea Tink’s electorate has been abolished in North Sydney.
Sportsbet now has the Coalition as favorites for the next election, with odds of $1.72 compared to $2.10 for Labour.
But the Liberal and National parties need to win 18 seats to have a chance of winning the necessary 76 seats needed to form a majority government, following electoral redistributions that reduced the number of seats in the lower house to 150.
A Newspoll from early November showed that there was a three percent swing towards Labor after preferences, which would mean the loss of seven seats, bringing the total down to 70 seats.
Labor could form a government with four Greens MPs, assuming all are re-elected, plus left-wing independent Andrew Wilkie and one Teal MP.
The Coalition’s number of seats would only increase to 65 seats, making it more difficult to come to power.
That couldn’t be possible a minority government and the exclusion of Labor and the Greens even if they had the support of all six re-elected Blue Green MPs plus conservative independents Bob Katter, Dai Le, Rebekha Sharkie and Andrew Gee.