Treasurer Jim Chalmers wants to make the super system more sustainable. Photo: Supplied.
The socialist barbarians are at the gate if you believe the fire hose of criticism unleashed in the Murdoch media over Treasurer Jim Chalmers’ modest proposal to cap superannuation accounts at $3 million to ease the burden of the 15 per cent tax concession on the budget.
At first, the move will only affect about 80,000 taxpayers lucky, or savvy, enough to accumulate such large balances, but the decision won’t be indexed, so it will draw in more as time goes on, as intended.
Some, such as key Senator, David Pocock, have called for an even lower cap of $2 million but indexed.
The Treasurer, who also had wanted the Stage 3 tax cuts up for debate before being shut down by Prime Minister Anthony Albanese, wants to make the super system more sustainable and, as you would expect, is looking for ways to repair the budget after the COVID-19 support and stimulus spending.
He should be congratulated for making a start on the unsustainable largesse doled out in the Howard/Costello years that has undermined the budget and rewarded Australians who are already winners and white-anted the foundations of an equitable society.
Tax reform, in general, is long overdue, but once a constituency of rent seekers has been built, taking away their privileges is a risky business for any government, especially a Labor one.
The mob at the national broadsheet are speaking to their audience, but the alarmist torrent this week is designed as ever to influence public opinion, put the frighteners on the government and bolster the Liberal Party.
Opposition Leader Peter Dutton has already said the Coalition would knock the plan on the head. But being the friend of millionaires will be a tough sell at a time when so many Australians are doing it tough.
The conservative reaction is typical of what anybody has to deal with if they propose changes that might lead to a fairer tax system.
Former Labor leader Bill Shorten fell foul of the Murdoch megaphone at the previous election when his sensible but too-detailed reform program came under ferocious attack and may have cost him the Prime Ministership.
No wonder his successor went softly-softly in last year’s campaign.
Hence all the cries of a broken promise and how that will damage the government.
What nonsense. No government is bolted onto its election manifesto. Just ask John Howard.
Chalmers is tackling what is obvious to everybody – those who will be affected are using an overly generous super system as a tax shelter and wealth generator, not for its intended purpose of retirement income.
The critics and lobbyists are doing what they always do – exaggerating the number of losers and diversity of backgrounds so they can spook as many people as possible and attract them to their cause, much like the misleading but successful campaign on franking credits.
They argue the revenue collected will only be minimal as people move their money elsewhere. It’s not just about revenue, it is the ongoing cost to the budget. If the money does go, it only proves the point about its real reason for being there.
Predictably, there are cries of class warfare. But if anything, policies such as this have been part of a decades-long project to stack the deck against ordinary Australians.
What the critics are really worried about is that the whole neo-liberal project might be unravelling.
At a time when the cost of living is going through the roof and the nation faces crises on multiple fronts – housing, aged care, health – how can such an ongoing gift to the wealthy be justified?
Is it really that radical a principle to stop diverting money to those who do not need it and spend it where it is needed or to find ways to rein in the deficit that cause the least pain?
This should be just the start of restoring integrity to the tax system, if Labor has the stomach for it, because Australia is reaping a terrible harvest from policies that have favoured the well-off and entrenched inequity.
Negative gearing and capital gains tax concessions, which have built a landlord class and given us some of the world’s most expensive and overpriced housing, should be added to the Treasurer’s list. Not to mention those stage 3 tax cuts.
Declining homeownership rates, a rental crisis and rising homelessness are the legacies of Peter Costello’s worship of capital and property.
Canberra cartoonist Pryor used to draw Costello in Victorian garb and Dickensian grimness. For many, that is where many Australians are headed – some are already there – if Labor cannot unwind that legacy.
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