In a virtual address to the Association of Super Funds Australia conference on Thursday, O’Brien said Labor politicians “look out over this vast, $4 trillion pool of Australians’ retirement savings, and imagine all the wonderful things they could do with it”.
“When I say Labor thinks of super as its personal piggy bank, I mean it literally. Labor’s Super Tax 1.0 was one of the most egregious money grabs in the history of Australian tax policy,” he said.
“It should go without saying that taxing unrealised gains, and doing so in a way that would capture an ever-growing share of Australian workers, is an idea that should never have made it out of the lab.”
O’Brien claimed that there are still many questions to be answered about the initial policy.
“It’s not over. We have since come to learn that taxing unrealised gains was the simpler version of the policy,” he said.
He continued that “no doubt” the government is “furiously reworking” the revised legislation into an even more complex bill and suggested that if the draft legislation makes its way through parliament it may not raise the revenue the Treasurer claims it will.
“That’s notwithstanding the reported $20-billion black hole the Treasurer’s Super Tax 2.0 could blow in the budget,” O’Brien said.
He continued that Australians have more than $4 trillion of their wealth stored in superannuation accounts and “for the most part, it was not their choice to accumulate their life savings in their super accounts” but a decision made for them by government.
“As compensation for their being denied that freedom, the earnings on their savings are taxed a bit lighter than they otherwise would be, and as a consequence, as their savings accumulate more quickly, not only do they personally benefit from greater wealth, but so too, do the Australian people,” he said.
“For many people, super is their nest egg. They worked hard all their lives, they followed the rules, they paid their taxes and a good chunk of their pay was locked away in their super accounts.”
He added the Australian superannuation system was built on trust that people’s money would be managed solely in their financial interests, that it won’t be extracted in the form of exorbitant fees and that governments won’t treat their savings as a “personal piggy bank”.
