What the superannuation tax increase means for NFPs
Recent superannuation changes is good news for not for profit organisations. It means we are finally approaching a government who will likely listen to our plight.
The announcement made yesterday by Treasurer Jim Chalmers will see an increase in the tax on superannuation balances above $3 million, leading to increases from 15% to 30%, much to the surprise of many in the space. Shadow Treasurer Angus Taylor has quickly declared that Labor is going back on their election promises of not touching super, and that the Treasurer’s next move would likely be going after stage 3 tax cuts.
This measure will bring in an additional $2 billion per year of revenue for the government, the two main reasons for the change given by the Prime Minister and Treasurer, it would help the budget bottom-line, and provide more equitable taxation in superannuation. This change will take effect after the 2025 election, likely in the 2025-26 financial year. Following this announcement, the Prime Minister has said there would be ‘no changes this term’, meaning no material changes this term, but not ruling out that more legislative changes may be on the horizon.
These sorts of changes suggest this government is prepared to target the wealthier segments of the Australian economy. That it is ready to make ambitious changes that redistribute wealth, these changes may not be in the immediate future but a Labor government is ready to start supporting and uplifting NFP voices.
What should you do upon hearing this news? Synthesise your lobbying ask- make it clear, concise and consistent. Your voice will be heard by this Government. Due to the many crises that the Australian economy is recovering from, funding may not be immediate, but our recent connections with the new government, across many meetings with our clients, suggests they are ready to support NFPs, and hear their ask. Your submissions will get a fair chance with the treasury and the various departments.
If you are unsure on how to clarify your ask, who to target, or the best way to improve upon your current engagement, please get in touch with us and we would be happy to help.
