Assistant Treasurer Stephen Jones has defended the changes.Credit: SMH
Last week, a Senate economics legislation committee strongly supported the bill, finding that current super tax concessions “disproportionately benefit Australians with very large balances at a significant cost to the federal budget”.
“The committee also highlights evidence that the taxation of unrealised capital gains is not unknown to the Australian tax system,” the committee said. It also pointed to evidence that all superannuation trustees have an obligation to keep sufficient liquidity within their account to meet their Australian Prudential Regulation Authority obligations.
Peter Cameron, venture partner at impact investment fund Giant Leap, said he often invested in promising technology businesses and founders through his self-managed super fund (SMSF).
“I’m disturbed to read about potential changes to the taxing of unrealised profits in these funds,” he said.
“Quite frankly, I can’t understand how I can be taxed on a totally illiquid investment that may or may not generate some form of profit for us when it finally exits, which could be some five or 10 years away. The valuation of such investment will, at best, be difficult, if not impossible, to be accurate with.
“This is a policy that, if implemented, would see me stop dead in investing in innovative companies through my SMSF. I thought that we were trying to encourage Australian businesses to innovate and compete in a global community. To do so, angel investors are critical for these businesses to get established, and in my opinion, this policy will kill off a substantial amount of these investments.
Carolyn Breeze: Changes would be a “kick in the guts”.
“Please reconsider for the sake of this country’s start-up businesses,” Cameron said.
Technology investment fund Scalare Partners’ chief executive, Carolyn Breeze, said the proposal was a “kick in the guts.”
“It’s time for Australia to get serious about improving our innovation exports, but policies like this move us 10 steps back,” she said.
“The government must evaluate the potential impact of these reforms, to avoid stunting innovation and growth in our economy, especially after launching its Future Made in Australia initiative.”
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