The federal government will grant more than $22 billion in concessional taxation on superannuation earnings in the 2025 financial year, but has noted this figure will increase by more than 10 per cent over the next three years.
The figure was released by Treasurer Jim Chalmers as part of the government’s 2024/25 Tax Expenditures and Insights Statement, in which concessional taxation of superannuation earnings was predicted to be $22.2 billion, up from $17.45 billion, in the 2024 financial year.
According to the statement, the level of concessional taxation increased by 6.2 per cent from 2020/21 to 2023/24, but was estimated to rise by 13 per cent over the forward estimates period, which covers the next three financial years.
The concessions dwarf those given to personal superannuation contributions, which are estimated to be $1.8 billion for the 2025 financial year.
Using figures from the 2022 financial year, the statement noted around 16.8 million people benefited from the concessional tax treatment of superannuation earnings, with the average benefit being $1140, and men receiving 61 per cent of the benefit compared to 39 per cent of women.
“Men received an average benefit of $1720 compared to $1160 for women. This reflects men, on average, having larger superannuation balances and facing higher marginal personal income tax rates,” the statement said.
“The share of the benefit from superannuation earnings tax concessions is highest for people aged 55 to 69, reflecting that Australians in these cohorts are generally in higher-income deciles and have had longer to accumulate superannuation balances. Fifty-one per cent of the benefit of earnings concessions went to people aged 60 or older.
“The average benefit for those aged over 55 who have superannuation was also higher because of the 0 per cent tax rate applied to earnings in the retirement phase.”
