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The Federal Budget has confirmed the government will push ahead with its Division 296 tax for superannuation balances above $3million as planned.
The government has remained staunchly committed to the division 296 tax in recent months despite wide-ranging pushback on the controversial measure.
Tuesday night’s budget confirmed that the government has no plans of backing down on the tax and will take what the SMSF Association has called an “ill-conceived initiative” to the election.
SMSF Association chief executive Peter Burgess said the government has continued to ignore the concerns of the super industry even as the measure has been rebuffed in the Senate.
“As a revenue item, [the] budget was the last opportunity for the government to either take this tax off the table or make changes to address the significant issues raised by industry and the Parliament,” Burgess said.
“Material changes to this tax, which impact the government’s previously budgeted revenue estimate for this proposed measure, would have needed to be reflected in the budget.
“Considering there was no mention of changes, the government is now committed to taking this tax to the next election, warts and all.”
The CEO added that it is a complex tax initiative and would be difficult and costly for both the ATO and broader superannuation industry.
“It’s disappointing that the government has decided to ride roughshod over these legitimate concerns. As we have said ad nauseum, it’s time for the government to take this tax off the table and work with industry on an equitable solution to the problem they are trying to solve,” Burgess said.
Other “simplification measures” proposed by the SMSF Association, such as reducing the number of total super balance thresholds and simplifying the transfer balance cap regime, were also not included in the budget.
