It took just over a week for the federal government to go from floating an idea about an objective for superannuation to announcing an increase in tax on the earnings of super funds that have account balances of more than $3 million.  

At the Conexus Financial Political Series breakfast on February 20, treasurer Jim Chalmers released the government’s draft wording on an objective for superannuation.  

That objective included references to the equity and sustainability of the system, and the debate shifted swiftly to the tax concessions afforded to superannuation funds – primarily self-managed superannuation funds – with “excessive” balances. 

Just eight days later, Chalmers and minister for financial services Stephen Jones announced “people with balances above $3 million will receive less generous tax breaks”. 

But despite the apparent haste, new research suggests public support for the move is strong. 

Support for tax

A survey of 6830 Australians aged 18 and over conducted by CoreData Research on March 2 found around two-thirds of Australians support the government’s move to target account balances above $3 million.  

Moreover, eight in 10 (80 per cent) respondents think the superannuation tax proposal is an effective way to tax the wealthy. 

Awareness of the government’s proposals is also high, with 90 per cent of respondents aged over 55 saying they know about the tax increase, and two-thirds of respondents aged under 55. 

Awareness of the proposals also appears to be linked to the size of super account balances, with 95 per cent of respondents with more than $200,000 in super saying they are aware, compared to 73 per cent of respondents with less than $50,000 in super. 

Opinion is divided on the government’s reneging on a pre-election promise not to introduce changes to super, with half of respondents saying they care the government has reneged, and half saying they do not care. But seven in 10 believe that raising the tax rate on balances above $3 million will not be the last move on superannuation that the government makes. 

While the research suggests the move to increase tax on a small number of Australians’ super funds is largely supported by the public, touching the family home is a completely different matter. 

Just 1 per cent of respondents in the CoreData research say a move to tax the family home is “fair”. Eight in 10 respondents believe the family home should not be taxed, but just over four in 10 (41 per cent) think second homes and investment properties should be taxed.