Politicians will have preferential treatment under incoming policy

Barely weeks into his second term, a political reckoning is emerging for Labor Prime Minister Anthony Albanese over his flagship superannuation tax measure.
Opponents of Labor’s 30% tax on earnings from super balances above $3 million will likely be galvanised after learning that members of defined benefit schemes, including many current and former politicians, will have the tax deferred until retirement.
According to an AFR report, the likes of Albanese, cabinet ministers like Penny Wong and Tanya Plibersek, are permitted to defer their tax liability until they begin receiving pension payments.
Any politicians elected into parliament before 9 October 2004 and are part of the Parliamentary Contributory Superannuation Scheme (PCSS), will capture the benefit.
Interest on the deferred tax will accrue at the government bond rate (currently around 4.5%), but the deferral still grants a significant cash flow advantage to political figures and other professionals on DB schemes.
In contrast, private superannuation and SMSF members must pay the tax, including on unrealised gains, annually, even while still working.
For many Australians, especially those holding illiquid assets such as investment properties, this immediate tax could require asset sales – forcing restructuring of portfolios and, potentially, fire sales of appreciating property.
The tax is set to begin on 1 July, aiming to raise $2.3 billion annually. But its inclusion of unrealised capital gains and the non-indexed threshold – alongside preferential deferral mechanisms for veteran politicians – could hit Albanese where it hurts – popularity among the voting public.
Albanese has little to no political opposition in passing the tax through of course. With a commanding senate majority, the Liberal Party in tatters and The Greens having a crisis of their own, Labor effectively has carte blanche to pursue its tax reforms as it sees fit.
Understanding the $3 million super tax
Under the new policy, earnings on superannuation balances exceeding $3 million will be taxed at 30% – double the current rate of 15%. This includes not only realised investment income but unrealised gains, meaning paper profits on assets such as shares, property, and business holdings will also be taxed annually.
Crucially, this threshold is not indexed to inflation. Treasury data suggests that while only 80,000 people will be affected initially, up to 1.2 million could be impacted within 30 years – many of whom may simply be average earners benefiting from compound growth and rising asset values.
Industry leaders, including AMP chief executive Alexis George and Aware Super’s Deanne Stewart, have slammed the proposal’s complexity.
Read more: ATO warpath should give SMSF investors cause for concern
George called the taxation of unrealised gains “difficult to administer and understand”, warning it could discourage long-term investing and shake public confidence in the $4.2 trillion super system.
“There’s a risk of bracket creep on steroids,” George said, likening the unindexed threshold to income tax bracket creep, which stealthily drags more earners into higher tax brackets due to inflation.
Implications for mortgage brokers
The policy has significant ramifications for mortgage brokers, particularly those advising clients on property investment strategies through SMSFs or as part of retirement planning.
Taxing unrealised gains could force investors to liquidate property assets to fund yearly tax liabilities – especially problematic for SMSF members with concentrated portfolios in real estate.
Brokers may find clients reconsidering property investment within super due to heightened tax exposure. This shift could dampen loan demand for SMSF-backed property deals.
Brokers can add value by helping clients restructure investment strategies pre-emptively—such as diversifying portfolios, shifting from growth to income assets, or timing disposals before the tax triggers.