Peter Dutton described Labour's plan to reduce the tax relief of pension balances by more than $3 million as a "quasi-inheritance tax."
The description is a few days from voting day as the main parties tear up their opponents’ policies in their final efforts to win the vote.
"Labor believes in inheritance taxes every day. It's part of their socialist agenda," Dutton told Sky News on Wednesday.
“This is a quasi-inheritance tax, calling it reality, and that’s reality.”
Let's break down whether Labor policy is suitable for such a definition.
Labor announced a tax relief policy for more than $3 million in pension balances in 2023, but the government failed to secure the support of the crossbench during the semester.
The policy proposes tax revenue on excess balances over 30% of over 30% of over 30% of over 30% - now doubles the 15% .
Importantly, those with larger super balances can only pay higher interest rates above the $3 million threshold.
Anthony Albanese told the National News Club on Wednesday that he adhered to the policy, while noting that it would only affect 0.5% of the “pension population.”
"It doesn't mean they haven't gotten concessions, it just means the concessions aren't that big," he said.
What happens next will depend on the composition of the next Parliament.
Many developed countries impose an inheritance or estate tax on assets that flow out of deceased estates, such as currency or property.
There is only marginal difference in how inheritance and inheritance taxes work, neither in Australia.
Japan's inheritance tax (one of the largest taxes in developed economies) rose to 55%. The U.S. federal estate tax is as high as 40%, plus additional inheritance taxes imposed by a few states.
It is worth noting that many of the inheritance taxes, including the United Kingdom, France and Germany, are not socialists. Tickets, often embedded in economies many generations ago, are now seen as government revenue mechanisms, regardless of potential ideology.
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Brendan Coates, director of economic policy planning at the Grattan Institute, said it was "complete nonsense" to describe Labour's pension policy as inheritance tax.
"The only way you think this is an inheritance tax is if you think the super purpose is to pass the money to the kids, but that's no different from any other asset that anyone has," Coates said.
"You can say the income tax or capital gains tax is inheritance tax. By that definition, each tax is inheritance tax."
A policy analyst told Australia that the final days of the campaign were full of “resonance and intimidation campaigns” and described Dutton’s comments.
Opposition leaders pursue this particular policy for a reason.
Opponents of the Labor Super Plan noted that there is no threshold for indexing $3 million, meaning it will attract more people every year as income and asset prices rise.
While a few Australians have retirement accounts of more than $3 million (estimated around 80,000, most of them over the age of 60), workers who accumulate such a sum may one day oppose Labor's policy.
High-value super accounts tax on “unrealized gains” – The increase in value of unsold assets is also controversial, drawing criticism from different groups of people, including rural and regional parts of Australia.
If people who are concerned about their members may face cash flow problems, they may face cash flow problems if they are forced to pay taxes on agricultural properties held with self-managed funds.
However, apart from politics, even the most intense critics of the plan did not describe it as a socialist inheritance tax.