Australians generally show a surprising lack of opposition to an impending tax increase, despite the common sentiment that higher taxes are unwelcome. The proposed change will see earnings from superannuation accounts exceeding $3 million taxed at 30%, up from the current rate of 15%. This measure is touted to impact only the wealthiest 0.5% of account holders, approximately 80,000 individuals, and is expected to raise around $2 billion for the federal budget in its first year.
A recent survey conducted by eToro and Spaceship reveals that a significant portion of Australians is supportive or indifferent to the tax increase, with 45% of respondents in favour and 29% neutral. Only 26% expressed outright opposition. Opposition was notably higher among those aged 60-65, likely due to their likelihood of holding larger super balances and drawing from them, with 37% opposed. Conversely, support was strong amongst younger Australians, particularly Gen Z, with 48% of those aged 18-27 backing the measure and only 16% against it.
Industry experts, like eToro’s managing director Robert Francis, highlight the emerging consensus on the necessity for reform concerning high super balances. This sentiment is seen as a push towards more equitable retirement systems, especially from a younger demographic that perceives the tax increase as a chance to balance wealth distribution. For older Australians, however, the tax may appear as a risk to their retirement savings.
The government, emphasising that the change will predominantly affect a small segment of the population, is prepared to enact the tax given its strong majority in the House of Representatives. Nonetheless, to pass through the Senate and become law, the proposal will require the backing of either the Greens or the opposition, adding a layer of complexity to its implementation.