The council has called on the government to lock in indexation for LISTO changes to protect low-income workers and narrow the gender super gap.The Super Members Council (SMC) has urged the Australian Government to ensure an upcoming fairness fix for 1.3 million low-paid workers, mostly women, is “done once and done right” by locking in automatic indexation of the Low-Income Super Tax Offset (LISTO).
The council welcomed the government’s pledge last October to unfreeze the LISTO for the first time in 13 years, lifting the income threshold for eligibility from $37,000 to $45,000 and increasing the maximum rebate from $500 to $810.
However, the SMC warned that without indexation, more than 30 per cent of the upcoming increase to the maximum LISTO payment would be eroded within five years, with around 445,000 fewer Australians eligible if income tax thresholds remain unchanged.
Indexing both the LISTO payment amount and eligibility threshold is the best way to protect low-income workers from inflation and ensure fairness and consistency in indexation for the poorest and wealthiest Australians alike, according to the council.
It has advocated strongly to unfreeze the LISTO, building momentum for the super rebate boost pledged last year to help Australia’s lowest-paid workers and further narrow the gender super gap.
The LISTO is designed to top up the super of low-income workers so they do not pay a higher rate of tax on their super than on their take-home pay. It had been frozen for 13 years and fallen behind changes to tax brackets and super contribution rates, eroding its value over time.
Council modelling shows boosting the rebate could mean some lifetime low-paid workers have up to $60,000 more in their super savings by retirement.
Its research also shows 1.3 million workers missed out on a total of $3 billion since 2020 due to the freeze, with women making up around 60 per cent of those affected.
Currently, a cleaner earning $42,000 receives only a 1 per cent concession on their super tax compared to their marginal income tax, while a senior manager earning $220,000 receives a 30 per cent tax concession. The government’s announced changes aim to make the super system fairer for low-income workers.
SMC research shows women, approximately 740,000 in 2025–26, have been disproportionately affected by the LISTO freeze, missing out on $295 million this year alone.
The council said unfreezing the LISTO will benefit younger workers and part-time working parents in lower-paid sectors such as care, retail, hospitality and health.
SMC chief executive Misha Schubert said the boost to LISTO would strengthen fairness in the super system and must be futureproofed.
“We all know, when something’s out of date, you fix it. Fixing the LISTO will make a big difference to the retirements of more than a million of Australia’s lowest-paid workers,” Schubert said.
“And when you fix something, you make sure it’s done once and done right, so you’re not faced with the same problem again in five years’ time. It just makes sense.”
