Treasury Laws Amendment (Better Targeted Superannuation Concessions and Other Measures) Bill 2023, Superannuation(Better Targeted Superannuation Concessions) Imposition Bill 2023

In continuation, I spoke before about Labor’s broken promise, and the promise was to not make any changes to superannuation. There is absolutely no doubt that this decision undermines Australians’ confidence in the superannuation system itself, because they don’t have certainty. They know they cannot trust Labor not to make further changes. This decision will affect far more people than Labor is actually claiming. Their claim is the next misleading statement being made by the government in relation to this bill, because the $3 million cap is actually not indexed and Labor is doubling the tax on superannuation for one in 10 Australians by the time they retire—for younger ones is what this means.

Treasury’s own analysis shows that a 20-year-old today earning an average wage will, over their lifetime, pay higher taxes under Labor’s scheme. Analysis of data from the ATO and census shows that over two million Australians who are today under the age of 25 will be hit by this latest tax grab by Labor. That means millions of hardworking young Australians will be affected—our young Australians, many of whom are probably not aware of exactly how this is going to affect them when they retire. It will affect young professionals, be they teachers, nurses or engineers. I hear that the government in this budget is saying that it wants 80 per cent of young Australians to go to university. The types of careers that they’re going to be pursuing will put them in the firing line. Whether they’re lawyers, pharmacists, engineers or medical professionals, they will be affected.

This will disincentivise people from putting their own money—after all, it is their money—away for their own retirement. They want to fund it and do the right thing. What will $3 million actually be worth in 40 years time? That’s another question for the government to consider. This attacks aspiration and discourages people from taking more responsibility to fund their own retirement. We know that the big super funds and therefore Labor want to get rid of our self-managed super funds. Retirees and superannuants will now face basically a doubling of tax on the money they haven’t yet earned or received. It will hit small business owners, farmers and self-managed super funds the hardest, but clearly that was the government’s intent. Taxing unrealised capital gains means Australians will be taxed on money they haven’t actually made or received, and it actually doubles the taxation on an asset that they haven’t even sold. It’s really hard to explain this in a way that makes any sense. It doesn’t make sense. The tax will be applied year on year, on a recurring basis, on that same asset every year.

If you’re a small business and you’re in this position, you’re going to have to pay to have the value of that audited every year and make sure that you sit beneath that $3 million, otherwise you’re going to have to pay double tax. If the value of the property escalates, they’ll have to, at times, sell the property to pay the tax and pay capital gains and stamp duties, and on and on the costs go for those people who’ve worked their hearts out to look after themselves in their retirement. Here’s the rub as I see it: if the value of that property drops and they’ve already paid tax the year before, they aren’t refunded. This is just extraordinary. It is just an extraordinary proposal.

But even more of an issue for me is the precedent this has set. Are Labor planning to tax other unrealised gains? If they’re prepared to do it for super, what’s next? Will the government actually tax unrealised gains on investment properties, share portfolios or any other form of investment? What’s going to stop them? If you were a homeowner, how would you feel if your home were taxed every year, year on year, and you had to pay tax on any and every increase in the value of that home, whether you retain or sell the home? It’s exactly the same principle behind what Labor is trying to do in taxing unrealised gains in superannuation. What’s next?

Not only will these changes affect young Australians, but, because this is a retrospective change, they affect our older Australians—hardworking Australians who believed that they could have confidence in saving their money for their retirement through a small self-managed super fund. These are people who have worked hard and saved with the absolute ambition to be a self-funded retiree, not dependent on the government or taxpayers, but, instead of respecting their hard work and initiative and willingness to take personal responsibility, the government is planning to punish them through this legislation.

It will hurt thousands of Australians. Often it’s the small-business people who may have bought a commercial property to run their business out of in that fund. It will, of course, grossly affect our farmers—the very people who grow our food and fibre. Unfortunately, it’s the same people that this government continues to show utter contempt for. Our farmers have been under constant attack. In my more than 50 years of farming, I’ve never been as worried about the future of our farmers as I am right now under this government.

When we look at the attacks, whether it’s the ending of the live sheep trade or the biosecurity levy—that obnoxious decision to make farmers pay for risks created by their foreign competitors—it just shows absolute contempt. There’s the ute tax that’s on its way as well, so good luck with us trying to do our work! There are the thousands of kilometres of transmission lines and solar panels that are going to take up valuable, productive agricultural land. There’s the nature positive act, which is yet to land. There’s just one attack after another on farmers. We’ve got 450 gigs of water yet to come out of the Murray-Darling. How many more farmers is that going to take out of business?

At some point, the government’s going to have to realise that farmers produce food. They actually need us, but you’d never guess that. This government, I think, would be happy to see more of us go because that frees up more land for wind, solar and transmission lines, and it’s probably looking at the water as well when it’s so focused on hydrogen production, because to produce a kilo of hydrogen, depending on whatever process you’re using, it’s upwards of nine litres of water. Depending on the process, it’s up to about 40-plus litres for every kilo. It depends on the system used.

I talked to one accountant about this measure, and he was just devastated for his clients. He actually knows, because some of his clients are small businesses and farmers, how hard they’ve worked and how they’ve actually scrimped and saved over their 30 or 40 years to put away what they need for their retirement. They’ve done all of the right things, and they’ve paid their taxes all the way through. They’ve taken personal responsibility, and they want to be independent and not need to draw on the pension or the taxpayer. But that’s exactly what this measure will do. It is going to affect those people, and it is going to affect the next generation of younger people as well.

There were speeches last night about how young people are trying to get into the farming and ag industry. If they don’t have help from their families, this is extraordinarily difficult because of the cost of actually buying or leasing property. For instance, if you want to get into the dairy industry as a young person, the return on investment means you’ll struggle to find a bank who will finance that, so you actually need help from the family to be able to do so. You’ve got to buy cows, land—even if you’re able to lease it—irrigation water, machinery, sheds, housing and a dairy, and you’re trying to do this from scratch. With the returns on that investment, you will struggle to find a financier to be able to support you to do so.

So there are many obviously intended consequences of this bill and the measures in it, and I suspect there are many more unintended consequences that, unfortunately, those who put this on the table don’t actually understand the implications of. I am very concerned about what’s next when we talk about taxing of unrealised gains.

Debate adjourned