A professional says all roads will lead back to superannuation in the next election.
Treasurer Jim Chalmers made only one sizable nod to the superannuation landscape last night, with the Paid Parental Leave concessions that had been previously announced.
Commenting on the budget, Aaron Dunn, chief executive of Smarter SMSF, said the government was sticking to its original commitment not to touch superannuation.
“It really all goes back to when the current government was elected and said it did not intend to make any changes to superannuation in its first term of government,” Dunn said.
“It is holding true to that. The Division 296 tax does not come into force until after the next election, so what I think it means, as I have said previously, is that all roads will lead back to superannuation in the next election.”
Dunn said the PPL was a condition previously insisted upon by the Greens in September 2023, for their support of the government’s super tax legislation.
“Interestingly, it now seems the Greens will also be trying to needle the government for a little bit more in regard to the Div 296 tax,” he said.
“In its response to the Senate economic committee’s report last week, it suggested the total super balance cap be reduced from $3 million to $2 million and asked for the removal of Limited Recourse Borrowing Arrangements because they believe it is a concern with property and housing issues.”
He said that the Greens had publicly stated the PPL would originally cost the government around $200 million a year and the budget papers predict it would reach about $1.1 billion over five years.
“That lines up with what the Greens said and as the government predicted it would recoup around $2.3 billion from the super tax measures, it is possible the Greens will ask for something else,” he said.
Katie Timms, superannuation specialist and partner at RSM Australia, said she was surprised there were no superannuation initiatives besides PPL mentioned.
“I haven’t experienced a budget with so little in it for superannuation since the TBAR announcements in 2017,” she said.
“I was expecting there may have been something on legacy pensions, residency rules and NALI as well. In one way it is good news that it gives the sector a little more time to figure out what to do with Div 296 tax, but it is also disappointing that there were so many little things that wouldn’t have taken much to fix that the government is still seeming to push aside.”
Timms said that given the absence of any mention of the objective of superannuation, especially in a budget heavily focused on infrastructure development, it could be considered in the next budget.
“Given this budget was all about cost of living, I would have thought there would be something in the budget to link the objective of super and the infrastructure planning, so it could still be on the cards,” she said.
