Tax on super over $100K a year

SUPERANNUATION earnings over $100,000 a year will be taxed under plans unveiled by Labor today.

Superannuation Minister Bill Shorten and Treasurer Wayne Swan made the announcement this morning. Watch it live above.

"We want to make it better, we want to make it fairer and we want to make it stronger," Mr Swan said of the superannuation system.

Under a wide-range of reforms announced today - which will pump $900 million of revenue back into the budget over the forward estimates - the design and administration of the higher concessional contributions cap will also be simplified.

Income streams over $100,000 will be taxed at a concessional rate of 15 per cent under the changes.

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Mr Swan said there was "something wrong" with the system that everyday working Australians weren't getting the best deal from superannuation.

Mr Shorten said "we want to take superannuation above politics".

"We believe the system should be targeted at everyday earning Australians," he said.

"We all know that concessions can't be open ended.

"Once you've achieved a comfortable level in retirement savings, you probably don't need as much as those who haven't gotten to that point."

He said the changes "were not retrospective".

"Vigilance dictates that we must make these hard changes," Mr Shorten said.

He said any savings up to $100,000 would remain tax free.

The changes will come into place from July 1, 2014.

Click on this link for the full announcement details.

Mr Shorten said the changes would also apply to parliamentarians.

Treasury estimates around 16,000 Australians will be affected by the measure in 2014-15 which represents 0.4 per cent of Australia's projected 4.1 million retirees in that year.

A special Council of Superannuation Custodians will be established to ensure any future changes to the sector are consistent with the agreed Charter of Superannuation Adequacy and Sustainability. 

Share the anguish of columnist Joe Hildebrand, who painstakingly avoided talking about superannuation... until now.

Mr Shorten said the changes would continue "our unbeaten legacy" on superannuation.

Mr Swan said the changes were aimed to "clip at the top".

"We are approaching this task not from the viewpoint of the forward estimates of the budget but for the longer term," he said.

Mr Shorten said the government wasn't "specifically targeting" self-managed super funds.

Mr Swan said much of the speculation on superannuation over recent weeks had been wrong.

He said the cabinet had met last night to discussed the reforms.

"We've concluded by and large our discussions in this area," Mr Swan said.

Mr Shorten called on the Coalition to drop it's plans to re-introduce taxes on super contributions for the lowest earning Australians.

Mr Shorten said he expected "cries of outrage" from the wealthy over the reforms.

"There is a day of reckoning here," he said.

Mr Swan and Mr Shorten could not guarantee the proposals today would be put to parliament before the September election.

"We will do what we can in the time available before the next election," Mr Shorten said.

Mr Shorten brushed off calls from the Industry Super Network today who urged the government to make no changes to superannuation before the election.

"I would be interested to see what they say now in the light of this announcement," Mr Shorten said.

Asked if the changes would help fund the Gonski education reforms and the National Disability Insurance Scheme Mr Swan said it was one of many savings that would help bring back revenue.

"You do create room in the longer term for policy proposals," Mr Swan said.

"There is no magic wand or one area of savings that will instantly change the fact that revenues have come off dramatically."

Speculation over the government’s planned raid on superannuation hit fever pitch this week.

The reforms were due to be part of next month’s federal budget.

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