Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026, Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026; Second Reading

Senator McKim supported the bill as a small step towards addressing wealth inequality, noting it increased taxes on the superwealthy and boosted the low-income superannuation tax offset. McKim argued the tax system remains broken, with high-balance accounts still paying lower rates than low-income workers. McKim called for broader, more ambitious tax reform in the upcoming budget to address intergenerational inequality.

Senator Hume opposed the legislation, stating it broke election promises and truncated debate through guillotining. Hume argued the government retreated from taxing unrealised gains and freezing indexation only after intense scrutiny from the coalition and stakeholders. Hume claimed the bill was a revenue grab driven by government spending excesses and warned it would erode trust in the superannuation system.

Senator Smith opposed the bill, highlighting that the government abandoned taxing unrealised gains and freezing indexation due to external pressure. Smith argued the changes undermined confidence in retirement savings, particularly for small business owners and regional Australians. Smith warned that treating superannuation as a revenue source risks destabilising the entire system and called for fiscal discipline instead.

Senator Tyrrell supported the bill, praising the removal of taxes on unrealised gains and the introduction of indexation for thresholds. Tyrrell noted the reforms would benefit low-income earners and raise revenue from high-balance accounts. Tyrrell also called for scrapping the 30-hour work threshold for under-18s to ensure all young workers receive superannuation contributions.

Senator Scarr opposed the bill, commending the coalition's role in forcing the government to drop taxes on unrealised gains and freeze indexation. Scarr argued the legislation introduced structural risks, particularly for surviving spouses and total and permanent disability recipients. Scarr warned that the bill was part of a pattern of government spending without corresponding revenue discipline.

Senator Pocock supported the bill but expressed concern over the lack of committee inquiry and the guillotining of debate. Pocock welcomed the indexing of thresholds and the removal of taxes on unrealised gains, noting these changes addressed significant flaws. Pocock raised concerns about the impact on defined benefit schemes and called for broader tax reform to address wealth inequality.

Senator Kovacic opposed the bill, arguing it was a rushed response to government spending issues rather than genuine reform. Kovacic highlighted that the coalition and community pressure forced the government to abandon taxing unrealised gains and freeze indexation. Kovacic warned that the legislation undermined trust and transparency, particularly regarding its impact on young Australians and small businesses.

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Whiteaker argued that the bills strengthen the fairness and long-term sustainability of the superannuation system by targeting tax concessions at their original purpose of helping ordinary Australians save for retirement. Whiteaker stated that the reforms modestly reduce tax breaks for those with very large super balances while maintaining concessional treatment for the vast majority of workers. Whiteaker highlighted that the low-income superannuation tax offset would increase to $810 with an eligibility threshold rising to $45,000, benefiting over a million Australians. Whiteaker noted that these measures would help close the gender retirement gap, as women often retire with significantly less superannuation than men due to career interruptions and part-time work.

Polley supported the bills, noting that superannuation tax concessions currently cost the budget more than $60 billion annually and disproportionately benefit high-income earners. Polley explained that from 1 July 2026, returns on balances ranging from $3 million to $10 million would be taxed at 30 per cent, while earnings above $10 million would face a 40 per cent rate. Polley stated that these reforms would affect less than 0.5 per cent of account holders and would provide up to $15,000 extra in retirement for low-income workers. Polley emphasised that 60 per cent of those benefiting from the increased offset would be women, helping to address retirement insecurity.

Darmanin welcomed the reforms, particularly the improvements to the low-income superannuation tax offset, which had been frozen for 13 years. Darmanin argued that the previous freeze meant workers earning between $37,000 and $45,000 missed out on tax refunds, potentially costing low-income women up to $60,000 in retirement savings. Darmanin stated that boosting the offset would benefit 1.3 million Australians, with around 60 per cent being women. Darmanin credited unions and advocacy groups for pushing these changes to improve retirement outcomes for low-income workers.