Nicholas Ali, head of SMSF technical services, Neo Super
My gut feeling is the Div 296 tax is dead. It is poorly designed, inequitable, and riddled with unintended consequences (or perhaps they were intended, which makes it even worse). No government in their right mind would run with such a millstone around their neck in the lead-up to a federal election that will likely be one of the closest in living memory.
Naz Randeria, managing director, Reliance Auditing Services
Labor will try its best to get Div 296 passed through the Senate by offering deals or under guillotine measures if they gather enough support. If not, Liberals will use it as a policy issue where they will scrap Div 296 in its entirety.
David Busoli, principal SMSF Alliance
If Parliament sits, the Division 296 tax will be on the table in February, but I suspect it will become an election issue instead.
Matthew Burgess, director, View Legal
It absolutely will be back on the agenda in one way or another – even if only to confirm it is abandoned. Whether it will become an election issue is difficult to predict, although the “go-to” narratives of “it only applies to the rich” versus “it could be you next” seem to write themselves.
More concerningly, (similar to the idea of taxing trusts as companies, being “entity taxation” for over 20 years), once these ideas are raised and legislation drafted they never seem to go away, regardless of what politicians may promise to get elected.
As Thomas Sowell observed, no one will understand politics until they understand that politicians are not trying to solve our problems. They are trying to solve their own problems – of which getting elected and re-elected are number one and number two. Whatever is number three is far behind.
Daniel Butler, director, DBA Lawyers
Perhaps the Labor government will realise it has stuffed up again; another Bill Shorten exercise seeking to reduce the CGT discount and get rid of franking credits. As noted previously, the way Div 296 was designed was a real shocker and Treasury and the government failed to listen.
If they seek to run it again, they should revise it to take the unfair and unreasonable aspects out and make it far more streamlined. Why should all super funds be inflicted with extra costs for administering it if it only impacts 0.5 per cent of members?
Aaron Dunn, CEO, Smarter SMSF
Well, it will only come up in February, ultimately, if they decide to sit or not, and I think it will be front and centre from a policy standpoint at the next election. There will be discussions about concessions available within superannuation, and the fact that those concessions are skewed in respect to those with much larger balances.
The background to that will certainly become a key part of the discussion. And again, Labor has a framework for them to take to the election, to say it is consistent with the objective of superannuation, to look to introduce that.
As I mentioned in a previous question, superannuation, I think, will be certainly front and centre when it comes to what we see in this election phase. We have very different points of view on both sides of Parliament.
Shelley Banton, head of technical, ASF Audits
All credit must go to Peter Burgess and his team at the SMSF Association, who have worked tirelessly to achieve the unachievable. Whether it becomes a policy issue for the next election depends on the Labor Party’s ability to read the room.
The financial services community has previously voted with its feet over unjust tax outcomes, so it’s only a brave political party that would pursue such a universally despised and flawed policy.
