The Federal Government announced on the 28th of February, a 30% tax rate will be introduced for superannuation earnings with balances over $3 million. Approximately 80,000 people will be affected by this proposed intruduction which will come into effect on the 1st of July 2025, after the 2025 Federal Election.
Those impacted accounts would retain the current 15% tax rate on earnings below the $3 million threshold but will pay double on future earnings on balances over$3 million increasing the tax rate to 30%. This introduction is expected to induce $2 billion in revenue in the first full year, then $3.2 billion over the following 5 years.
These changes will come in as the Government’s 2022-23 Tax Expenditures & Insights Statement shows that super tax concessions cost the government $50 billion per year, The Government has predicted that superannuation tax concessions are calculated to exceed Age Pension costs by 2050.