Yahoo Finance Budget 2023: Major $50,000 superannuation boost for Aussies
The Labor government announced changes to how super is paid and how it is taxed.
Aussie workers will see a major boost to their superannuation from the federal budget, with the government announcing payday super reforms.
Essentially, Aussies will now be paid super on the same day they are paid, rather than quarterly, as it is now.
Some have estimated the current system cost Aussie workers $33 billion in unpaid super over seven years.
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Treasurer Jim Chalmers and Assistant Treasurer Stephen Jones said millions of workers would benefit from the change, which the government wanted to start from July 1, 2026.
“This simple change will strengthen Australia’s superannuation system and help deliver a more dignified retirement to more Australian workers,” they said in a statement.
Industry Super Australia (ISA) said moving super payments to align with wages could give millions of Australians $50,000 more at retirement and drastically curb Australia’s unpaid super scourge.
“The one in four workers currently underpaid every year will get a huge boost to their super savings,” ISA said.
“This measure is a big win for younger workers, those in blue-collar jobs, hospitality and retail workers, who bear the brunt of unpaid super.”
New superannuation tax for the wealthy
Aussies with $3 million or more in their superannuation account will no longer be able to benefit from a lower tax rate.
At the moment, a person who makes voluntary contributions (above the compulsory 10.5 per cent taken from your pay) will only be taxed 15 per cent.
From [date], this will change to 30 per cent for those with a balance of $3 million or more.
Less than 1 per cent of all superannuation accounts have more than $3 million, and the tax changes will only affect around 800,000 people.
Changing the tax rate from 15 per cent to 30 per cent will also give the government around $2 billion more per year to play with.
Super Consumers Australia said the changes would go a long way to addressing imbalances in the retirement system.
“Everybody agrees that the objective of the super system is fundamentally about delivering retirement incomes. These changes will go a long way towards ensuring that the system is better directed towards the retirement income needs of the majority of people,” it said.
When will the super changes come into force?
Payday super will come into effect on July 1, 2026 to give super funds enough time to adjust to the change.
The new super tax changes will come into effect on July 1, 2025.
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