Think your nest egg is safe? Jim Chalmers may have other plans
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Treasurer Jim Chalmers left Australians guessing after signalling a fresh push for tax reform.
Hints of targeting senior’s superannuation and family trusts have already sparked political fire.
Opponents warned the move risked pitting younger generations against their parents and grandparents.
Liberal frontbencher Tim Wilson accused the Treasurer of deliberately stoking division.
‘Labor’s using generational language to wedge the debate to turn younger Australians against their parents and grandparents, but their real objective is to come after family savings,’ Mr Wilson said.
‘It’s like their family savings tax on unrealised capital gains—it starts hitting grandparents, but it then hits parents and then their grandchildren—it’s clever, it’s sneaky, you have to give them points for being so rat cunning.’
‘Starting tax brawls inside families is really low politics, but that’s where this government has got to because they didn’t achieve anything from their three day tax hike talkfest,’ he added.
Liberal finance spokesman James Patterson went further, warning the Treasurer was preparing the ground to ‘break an election commitment, to raise taxes’.
‘If he proceeds with it, it’ll be one of the biggest breaches of faith in modern Australian history,’ Senator Patterson said.
He claimed Labor could repeat its capital gains strategy—legislating changes now but delaying implementation until after the next election.
Mr Patterson warned family trusts would likely be the first target, despite their use by farms and small businesses.
‘It could really hurt some people who are not wealthy, and I think they’re going to do more on superannuation,’ he said.
The Treasurer himself had promised to address ‘intergenerational equity’ in the tax system.
One option floated was slashing income tax for workers while clawing back money from wealthier retirees through reduced super tax concessions.
The government had already moved to double the 15 per cent tax rate for super balances above $3 million.
It also left open the possibility of adopting a Productivity Commission recommendation for a 20 per cent company tax rate for businesses with turnovers under $1 billion.
Speaking on #7.30, host Sarah Ferguson pressed Mr Chalmers on whether the government was targeting seniors.
‘Let me put this simply—have you fired a shot now across the boughs of wealthy, retired baby boomers living off investment and the generous tax treatment that they enjoy. Are you telling them that this is now coming to an end?’ she asked.
‘I wouldn’t put it like that,’ Mr Chalmers replied.
He argued the government’s record already showed a focus on younger workers and women rather than only high earners.
‘One of the areas where the common ground was most obvious was, if and when we consider next steps in tax reform, we have to care about the intergenerational aspects,’ he said.
Pressed on whether retirees could face tax on earnings, withdrawals, or reduced capital gains discounts, the Treasurer said no decision had been taken.
‘It’s a matter for Cabinet,’ he added, leaving the door wide open.
A major signal came in the form of the government inviting Grattan Institute chief executive Aruna Sathanapally to launch the tax discussion.
Her message was clear—retirees needed to be taxed harder to ease the burden on younger Australians.
‘Reducing superannuation concessions so the system meets the policy objective of saving for a decent retirement, rather than being a tax shelter; introducing at least a low tax rate on earnings and withdrawals in retirement; reducing the capital gains discount; reforms to family trusts,’ Ms Sathanapally outlined.
After the roundtable, Mr Chalmers told reporters that reform could move ahead without a formal review.
‘I think our tax system is imperfect, and one of its most troubling imperfections is best seen through an intergenerational lens, which is why we take our responsibilities to the coming generations seriously,’ he said.
‘A fair go for working people, including in intergenerational equity terms. A simpler, more sustainable tax system to fund the services people need.’
The Treasurer’s hints about targeting super and family trusts have left many wondering what practical changes could follow.
One recent shake-up has already shown how tax reforms can directly alter retirement planning strategies.
If you’re curious about how these proposals are playing out in real time, here’s a closer look.
Read more: New tax laws prompt changes in retirement plans nationwide. Here's what we know
As younger Australians call for fairness and retirees brace for change, the question remains—will tax reform deepen divisions between generations or bridge them?
Hints of targeting senior’s superannuation and family trusts have already sparked political fire.
Opponents warned the move risked pitting younger generations against their parents and grandparents.
Liberal frontbencher Tim Wilson accused the Treasurer of deliberately stoking division.
‘Labor’s using generational language to wedge the debate to turn younger Australians against their parents and grandparents, but their real objective is to come after family savings,’ Mr Wilson said.
‘It’s like their family savings tax on unrealised capital gains—it starts hitting grandparents, but it then hits parents and then their grandchildren—it’s clever, it’s sneaky, you have to give them points for being so rat cunning.’
Wilson slams Labor’s ‘rat cunning’ tax plan. Image source: Pexels/Pixabay
Disclaimer: This is a stock image used for illustrative purposes only and does not depict the actual person, item, or event described.
Disclaimer: This is a stock image used for illustrative purposes only and does not depict the actual person, item, or event described.
‘Starting tax brawls inside families is really low politics, but that’s where this government has got to because they didn’t achieve anything from their three day tax hike talkfest,’ he added.
Liberal finance spokesman James Patterson went further, warning the Treasurer was preparing the ground to ‘break an election commitment, to raise taxes’.
‘If he proceeds with it, it’ll be one of the biggest breaches of faith in modern Australian history,’ Senator Patterson said.
He claimed Labor could repeat its capital gains strategy—legislating changes now but delaying implementation until after the next election.
Mr Patterson warned family trusts would likely be the first target, despite their use by farms and small businesses.
‘It could really hurt some people who are not wealthy, and I think they’re going to do more on superannuation,’ he said.
The Treasurer himself had promised to address ‘intergenerational equity’ in the tax system.
One option floated was slashing income tax for workers while clawing back money from wealthier retirees through reduced super tax concessions.
The government had already moved to double the 15 per cent tax rate for super balances above $3 million.
It also left open the possibility of adopting a Productivity Commission recommendation for a 20 per cent company tax rate for businesses with turnovers under $1 billion.
Speaking on #7.30, host Sarah Ferguson pressed Mr Chalmers on whether the government was targeting seniors.
‘Let me put this simply—have you fired a shot now across the boughs of wealthy, retired baby boomers living off investment and the generous tax treatment that they enjoy. Are you telling them that this is now coming to an end?’ she asked.
‘I wouldn’t put it like that,’ Mr Chalmers replied.
He argued the government’s record already showed a focus on younger workers and women rather than only high earners.
‘One of the areas where the common ground was most obvious was, if and when we consider next steps in tax reform, we have to care about the intergenerational aspects,’ he said.
Pressed on whether retirees could face tax on earnings, withdrawals, or reduced capital gains discounts, the Treasurer said no decision had been taken.
‘It’s a matter for Cabinet,’ he added, leaving the door wide open.
A major signal came in the form of the government inviting Grattan Institute chief executive Aruna Sathanapally to launch the tax discussion.
Her message was clear—retirees needed to be taxed harder to ease the burden on younger Australians.
‘Reducing superannuation concessions so the system meets the policy objective of saving for a decent retirement, rather than being a tax shelter; introducing at least a low tax rate on earnings and withdrawals in retirement; reducing the capital gains discount; reforms to family trusts,’ Ms Sathanapally outlined.
After the roundtable, Mr Chalmers told reporters that reform could move ahead without a formal review.
‘I think our tax system is imperfect, and one of its most troubling imperfections is best seen through an intergenerational lens, which is why we take our responsibilities to the coming generations seriously,’ he said.
‘A fair go for working people, including in intergenerational equity terms. A simpler, more sustainable tax system to fund the services people need.’
The Treasurer’s hints about targeting super and family trusts have left many wondering what practical changes could follow.
One recent shake-up has already shown how tax reforms can directly alter retirement planning strategies.
If you’re curious about how these proposals are playing out in real time, here’s a closer look.
Read more: New tax laws prompt changes in retirement plans nationwide. Here's what we know
As younger Australians call for fairness and retirees brace for change, the question remains—will tax reform deepen divisions between generations or bridge them?
