Banks join fight against super tax slug

Resistant to raising taxes on superannuation: Financial Services Council chief executive John Brogden. Photo: Rob Homer Changing tack: Trade Minister Craig Emerson. Photo: Paul Jones

The big four banks have joined a push to stop the Gillard government raising taxes on superannuation.

A delegation will go to Canberra next week to lobby Treasurer Wayne Swan to leave the super system alone.

The Financial Services Council, headed by former NSW Liberal Party leader John Brogden, will unite the banks and super industry bodies to push back against any move in the budget to raid the retirement savings of the wealthy.

The government is considering a raid on super to help rein in the ballooning deficit but faces resistance from within as well as from respected figures such as Bill Kelty, considered one of the architects of the superannuation system.

Trade Minister Craig Emerson gave the clearest hint yet that the government will shift the goal posts, saying there should be a debate on the tax treatment of the ”fabulously wealthy”. ”We are not seeking to impose new taxes on the superannuation accounts of ordinary Australians. But there is a legitimate debate about the very top end.”

Dr Emerson’s view provoked an angry response from the industry. Duncan Fairweather, chief executive of the Self Managed Superannuation Fund Owners Alliance, said the government was likely to sell any change as a Robin Hood-type hit on the wealthy.

”It is poor policy to raid people’s super savings to patch up the budget and poor politics to try to justify it as an attack on the wealthy,” he said.

The super industry said a $1 million nest egg – thought to be in the sights of the government – provided a modest annual income of $50,000, assuming a 5 per cent return on investments.

The alliance and the Industry Super Network, which represents more than 5 million members, called on Sunday for a greater consultation period than the six weeks until the budget allows.

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