Superannuation tax concessions for the wealthy would be wound back under a future Labor government as Bill Shorten seeks to position Labor as the party of fairness while also finding savings for a revenue-depleted budget.
Capitalising on public dissatisfaction at the extent of tax minimisation by wealthy individuals who have been able to park pre-tax income in superannuation accounts to avoid the top marginal tax brackets applicable to other earnings, Mr Shorten will announce the new policy formally on Wednesday.
The changes will limit the effective tax-free-threshold to superannuation earnings at or below $75,000 in any one year. After that amount is exceeded, a 15 per cent marginal rate would apply where currently there is none applicable. Labor estimates the size of the superannuation nest-egg needed to yield more than that in dividends would currently exceed $1.5 million.
A second change would reduce the high-income threshold at which the contributions to a super-fund attract a 30 per cent rate, twice the standard 15 per cent rate for everyone else.
That is currently set at $300,000 per year but would drop to $250,000.
Labor said together the two measures would save the federal budget an estimated $14 billion over 10 years.
Mr Shorten will justify the changes, which will attract criticism from some quarters as further tinkering with an already over-complicated superannuation system, as "responsible and fair".
"They are all about putting fairness back into the system ... and they're good for the budget," Mr Shorten said.
But he has also moved to reassure superannuants and soon-to-retire "baby-boomers" that superannuation changes will stop there.
"We believe these changes are all that are needed to ensure sustainability at the very top end of our superannuation system. If we are elected these are the final and only changes we will make to the tax treatment of superannuation."
A recent assessment by the Association of Superannuation Funds of Australia put the number of superannuation millionaires with $10 million-plus account balances at 475. ASFA also concluded there were another 24,000 people with $2 million-plus accounts - both groups earning hundreds of thousands and even millions in tax-free income from their superannuation.
In all it has been estimated that some 60,000 superannuation accounts have balances exceeding $1.5 million at present.
Part-pensioners would not be affected because the income cut-off for pension eligibility is well below the $75,000 income mark - and it is understood capital gains are to be grandfathered.
Labor argues the current arrangements disproportionately benefit the rich and thus constitute a subsidy from the poor to the well-off who, because of high levels of disposable income, can sequester more in favourably treated super accounts.
"Together with Labor's crackdown on multinational tax minimisation, these changes will return more than $20 billion to the budget over the decade," Mr Shorten said.
"This demonstrates how Labor will responsibly manage the budget and the economy without stifling economic growth or cutting billions of dollars from pensions, health and education like the Liberals want to do."
Meanwhile, Treasurer Joe Hockey, who is just weeks away from unveiling his second crucial budget, has written to Labor's treasury spokesman, Chris Bowen rejecting opposition calls for tighter tax rules for multinational corporations.
Labor had wanted the new rules introduced quickly and had offered bipartisan support for changes including tougher "thin capitalisation" rules for multinational businesses and integrity improvements via new "third party" reporting by business and government entities. But Mr Hockey said the first move would be counterproductive and could deter investment and harm jobs, while the second idea, required "extensive stakeholder consultation".
