Australia’s Tax System: Broken and Burdening Future Generations

The proposed $3 million superannuation tax is more than just a new revenue grab—it’s a symbol of everything wrong with Australia’s tax system. Blake Briggs, CEO of the Financial Services Council, recently criticised the policy, highlighting its fundamental flaws and warning of its long-term consequences.

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Taxing Unrealised Gains: A Dangerous Precedent

At the heart of the controversy is the government’s decision to tax unrealised gains in superannuation accounts. This means individuals will be taxed on theoretical profits that they haven’t actually received. As Briggs pointed out, this move violates key tax principles and sets a dangerous precedent for future policies.

SMSF Association CEO Peter Burgess has also been vocal about this issue, arguing that taxing unrealised gains is inherently unfair. Superannuation is meant to provide financial security in retirement, but this policy risks undermining that purpose by forcing retirees to pay taxes on money that exists only on paper.

Political Trickery at Its Finest

Briggs didn’t hold back in describing the policy as “political trickery at its crudest.” The government is selling this tax as a measure that only impacts the wealthy—those with more than $3 million in superannuation savings. But in reality, the effects of this tax will reach far beyond so-called ‘rich boomers.’

By choosing not to index the $3 million threshold, the government is ensuring that more Australians will be affected over time. What seems like a tax on the wealthy today will become a tax on everyday Australians in the future.

A Tax That Punishes Future Generations

One of the most alarming aspects of this policy is its long-term impact. Of the 500,000 working Australians expected to be affected by this tax, 400,000 are in their thirties or younger. This means younger generations, who are already facing housing affordability challenges and cost-of-living pressures, will now have to navigate an increasingly complex and punitive superannuation system.

Instead of creating a fair and sustainable tax framework, Australia’s government is opting for short-term revenue measures that could cripple retirement savings. At a time when younger Australians are struggling to build wealth, this policy places yet another obstacle in their way.

Australia’s Broken Tax System

The superannuation tax is just one example of the broader issues plaguing Australia’s tax system. Rather than implementing genuine tax reform that supports economic growth and fairness, policymakers continue to introduce new taxes that punish savers and investors.

A well-functioning tax system should incentivise wealth creation, not penalise it. Yet, by taxing unrealised gains and failing to adjust thresholds for inflation, the government is demonstrating a clear lack of long-term vision. This isn’t just a policy problem—it’s a sign of a broken tax system that is failing the very people it’s supposed to serve.

Where to From Here?

If Australia is serious about securing financial stability for future generations, meaningful tax reform is needed. That means addressing inefficiencies, ensuring fairness, and encouraging investment—not introducing arbitrary taxes that undermine confidence in the system.

The $3 million super tax is just the tip of the iceberg. Without serious reform, younger Australians will continue to bear the brunt of short-sighted policies designed for political gain rather than economic sustainability. 

It’s time for a real conversation about fixing Australia’s tax system before it’s too late.

Take action now and let the government of the day know how you feel, contact Prime Minister Anthony Albanese and let him know that you are not satisfied and want change now! 

Contact the Prime Minister today!