The Greens have agreed to support Labor's plan to increase taxes on large superannuation balances, ensuring the legislation passes the Senate. The decision ends a three-year political dispute over concessions for wealthy retirees.
Under the changes, the concessional tax rate on earnings for balances between $3 million and $10 million will double from 15% to 30%. Balances above $10 million will be taxed at a new 40% rate. The government previously scrapped a contentious element taxing unrealised capital gains and agreed to index thresholds to inflation.
Greens treasury spokesperson Nick McKim described the support as a 'down payment' on Labor pursuing genuine reform in the 12 May federal budget. He called for scaling back capital gains tax discounts and negative gearing to address housing inequality and wealth disparity.
The Coalition's opposition meant the Greens were Labor's only hope for Senate passage. The minor party chose not to demand further concessions, instead urging Labor to pursue bold tax reform in the upcoming budget.
Labor is considering winding back the 50% capital gains tax discount and capping negatively geared properties. McKim stated, 'The only limit is Labor's level of ambition.'
