The Albanese government’s proposed superannuation tax changes threaten the agricultural sector, the peak farming body says.
The government will lift the superannuation tax rate from 15 per cent to 30 per cent for earnings on balances above $3 million from the 2025/26 financial year.
About 80,000 Australians will be hit with the tax hike, which is expected to raise $2 billion in the first full year, and $3.2 billion over five years, which will go back into the budget rather than be spent.
National Farmers’ Federation chief executive Tony Mahar is urging the government to undertake formal consultation before the measure is budgeted and legislated.
“For many farmers, their farm is their superannuation, and it’s not uncommon to hold land assets in superannuation – particularly as the next generation enters the business,” he said.
“A change as significant as this can’t just be left to policy by press release, we deserve a formal consultation process to unpack the detail and provide input.”
Mr Mahar said the announcement would cause “significant uncertainty” for family farms, and risked slowing investment in an industry crying out for capital.
“Now is not the time to dampen investment in one of Australia’s growth industries that creates jobs in regional Australia and plays a central role in our transition to a low carbon economy,” he said.
Nationals leader David Littleproud said the government had broken its election promise, which amounted to a “breach of trust”.
He said the government had also introduced an element of risk for investors.
“There is now a lack of confidence … by Australian investors but also global investors Australia isn’t secure,” he told AAP.
Mr Littleproud said for many farmers and small businesses “they don’t always invest in their super because their business becomes their super”.
He said investment would be crucial to Australia as food security becomes a more prevalent concern for the nation and globe.
Research by AgriFutures Australia showed the agriculture industry needed an additional $3 billion in capital investment each year to reach the target of $100 billion in farm gate output by 2030, he said.
Consultation on the government’s plan will be undertaken between now and the budget, to be handed down on May 9.
(Australian Associated Press)