Changes to Div 296 super tax being considered, Treasury confirms

On Thursday (9 October), Diane Brown, the deputy secretary of the government’s Revenue Group, told the Senate estimates hearing that the government was weighing up concerns raised by stakeholders relating to the Div 296 super tax.

“There have been some conversations in the prime minister’s office,” Brown said, The Australian Financial Review reported on Thursday.

“It’s probably not unusual for that to occur from time to time, it remains unlegislated, and so stakeholders continue to raise questions about the bill.”

The Albanese government has reportedly been contemplating changes to its Div 296 super tax proposal, which would impose an additional 15 per cent tax on earnings of superannuation balances above $3 million.

Last month, the Financial Review reported that anonymous sources revealed Labor had discussed amending the tax bill’s most controversial aspects, including the lack of indexation of the $3 million threshold and the tax’s application to unrealised gains.

Today, Brown told the Senate Estimates committee that the government had discussed “concessions and concerns that stakeholders have raised” regarding Div 296.

At the hearing, Greens senator Nick McKim reportedly asked Brown whether Treasury had been asked to model specific amendments to the super tax bill, but she said “there has been no decision to amend the bill.”

However, she said that Chalmers had received advice on the potential revenue impacts that specific amendments to the bill could have.

“It’s reasonable and wouldn’t be surprising for us to understand concerns that people have raised, that’s part of that we may have looked at what might be the impact on revenue as a result of the suggestion or comment,” Brown said.

Shadow finance minister James Paterson, who was also present at the hearing, called for the Div 296 super tax to be scrapped entirely.

“Treasury has finally confirmed the worst-kept secret in Canberra,” he said.

“The Albanese government is seriously considering changes to Jim Chalmers’ friendless unrealised capital gains tax. But no tinkering at the edges can fix this fundamentally flawed bill. It shouldn’t be amended, it should be dumped entirely.”