Prime Minister Anthony Albanese has stated that his request for Treasury to review a contentious proposal to increase taxes on certain superannuation balances is routine. He dismissed claims that he intends to alter the proposal, emphasizing that there are no planned policy changes. "No, there are no policy changes, our policy stands. There is nothing unusual," Albanese said. He added, "We receive briefings on policy all the time, as you expect the prime minister's office to do. There's nothing unusual about that."

Treasury officials confirmed that the prime minister's office met with them to discuss the government's plan to raise taxes on superannuation earnings, a matter typically overseen by Treasurer Jim Chalmers. Albanese denied any overreach into the treasurer's responsibilities. The department is currently exploring options to address concerns regarding the tax proposal.

Previously, the federal government faced backlash after reversing its stance on stage three tax cuts. In the lead-up to that decision, it was revealed that Treasury had been asked to model potential changes to those cuts, despite assurances from both the prime minister and treasurer that there was "no plan" to amend them.

The proposed tax increase aims to double the tax rate on superannuation balances exceeding $3 million, raising the rate on earnings from 15% to 30%. This change was set to take effect on July 1 and was expected to generate approximately $2 billion annually.

The proposal has reignited controversy following the recent federal election. It has faced internal opposition within the Labor Party and criticism from prominent figures, including former Prime Minister Paul Keating. Keating warned that the average young person could be adversely affected by the tax increase by the time they retire if the proposal remains unchanged.

More than two years have passed since the proposal was first introduced, yet the legislation has not been finalized. Critics argue that the higher tax rate is not indexed, meaning that inflation could gradually subject more individuals to the tax over time. Additionally, the tax would apply to unrealized capital gains, such as increases in property values, which could lead to higher tax liabilities for savers who do not have immediate access to those earnings.

Concerns have also been raised about the potential impact on public confidence in the superannuation system, particularly if future governments are perceived to interfere with long-term savings plans. In defense of the proposal, Treasurer Jim Chalmers noted that it would only affect around 80,000 of the wealthiest Australians and suggested that the threshold could be adjusted in the future to account for inflation, similar to income tax adjustments.