1 00:00:08,080 --> 00:00:11,320 Speaker 1: Hello and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:11,400 --> 00:00:15,120 Speaker 1: James Kirkby. Welcome aboard everybody. Well, what a difference a 3 00:00:15,120 --> 00:00:19,480 Speaker 1: few days will make. We spoke, if you recall, in 4 00:00:19,520 --> 00:00:23,439 Speaker 1: the show last to this day last week, to Jeff Wilson, 5 00:00:23,960 --> 00:00:27,479 Speaker 1: and we talked about various things. Particularly we talked about 6 00:00:27,560 --> 00:00:30,720 Speaker 1: the new super tax, and not so much about that 7 00:00:30,880 --> 00:00:34,160 Speaker 1: tax being a new tax or that it affects people 8 00:00:34,200 --> 00:00:36,320 Speaker 1: with more than three million super which is a small 9 00:00:36,360 --> 00:00:38,520 Speaker 1: amount of people. I don't deny that for one moment, 10 00:00:38,960 --> 00:00:40,920 Speaker 1: but the nature of the tax that is going to 11 00:00:40,960 --> 00:00:44,000 Speaker 1: be based on paper gains, which is a big thing, 12 00:00:44,760 --> 00:00:48,320 Speaker 1: and we don't have taxes like that. Similarly, it's going 13 00:00:48,400 --> 00:00:51,479 Speaker 1: to be not be indexed, and that's really important and 14 00:00:51,560 --> 00:00:54,760 Speaker 1: worth exploring. But Jeff Wilson on the show was of 15 00:00:54,800 --> 00:00:58,240 Speaker 1: course assuming like we all were, that it was going 16 00:00:58,280 --> 00:01:00,840 Speaker 1: to be a hung parliament and that it was going 17 00:01:00,880 --> 00:01:04,600 Speaker 1: to be a reduced minority. The complete opposite has happened, right, 18 00:01:04,640 --> 00:01:08,920 Speaker 1: So we have a second term Albanese Labor administration with 19 00:01:09,040 --> 00:01:13,600 Speaker 1: an increased majority, and that means that a lot of 20 00:01:13,959 --> 00:01:19,120 Speaker 1: the agenda which has been created and defined in the 21 00:01:19,160 --> 00:01:22,560 Speaker 1: election campaign is going to come through. And what we're 22 00:01:22,600 --> 00:01:25,640 Speaker 1: interested in as investors is what does that mean? What 23 00:01:25,680 --> 00:01:29,520 Speaker 1: are the risks? What are the opportunities that we're going 24 00:01:29,560 --> 00:01:33,120 Speaker 1: to get as investors in this new administration. I talked 25 00:01:33,240 --> 00:01:35,720 Speaker 1: on Tuesday. I hope you didn't miss the show was 26 00:01:35,840 --> 00:01:38,319 Speaker 1: very good with Stuart Wims and we just talked. We 27 00:01:38,480 --> 00:01:43,040 Speaker 1: really just zoned in on two issues about the new government, 28 00:01:43,120 --> 00:01:48,240 Speaker 1: which is houses, house prices, investment property, and to some extent, 29 00:01:48,320 --> 00:01:51,800 Speaker 1: the changes with HEX and the outcome of that. By 30 00:01:51,840 --> 00:01:53,360 Speaker 1: the way, whichever way you look at it is that 31 00:01:53,400 --> 00:01:55,200 Speaker 1: house prices are going to go up, and are going 32 00:01:55,200 --> 00:01:59,920 Speaker 1: to go up fastest and the most in areas ironic, 33 00:02:00,080 --> 00:02:03,400 Speaker 1: clean enough where the first home bars Hunt, which is 34 00:02:03,440 --> 00:02:07,840 Speaker 1: in the sub million category. If you're an investment property person, 35 00:02:08,000 --> 00:02:09,919 Speaker 1: keep that in mind, that's going to be the heartly 36 00:02:09,919 --> 00:02:13,720 Speaker 1: contested part of the market. And as Stuart said very smartly, 37 00:02:13,720 --> 00:02:15,440 Speaker 1: if you're selling a property, well you might as well 38 00:02:15,440 --> 00:02:18,040 Speaker 1: wait till January when they're suddenly going to be eighty 39 00:02:18,080 --> 00:02:22,079 Speaker 1: thousand people with the five percent deposit wandering the streets 40 00:02:22,440 --> 00:02:25,400 Speaker 1: and looking at auctions where you will have much more demand. 41 00:02:25,720 --> 00:02:28,400 Speaker 1: Now today, I want to widen what we were talking 42 00:02:28,440 --> 00:02:32,120 Speaker 1: about and talk about all investing opportunities and risks under 43 00:02:32,400 --> 00:02:36,400 Speaker 1: the new Albanazy administration. My guest today is Will Hamilton 44 00:02:36,560 --> 00:02:38,960 Speaker 1: of Hamilton Wealth Partners, regular on the show How are 45 00:02:39,040 --> 00:02:39,320 Speaker 1: you well? 46 00:02:39,680 --> 00:02:41,480 Speaker 2: Very well, James, thank you very much for having me. 47 00:02:42,080 --> 00:02:44,680 Speaker 1: Very good to have you. One of the things before 48 00:02:44,680 --> 00:02:47,600 Speaker 1: we just kind of get into some particular issues. This 49 00:02:47,840 --> 00:02:51,840 Speaker 1: particular government is not particularly focused so far, at least 50 00:02:51,880 --> 00:02:57,280 Speaker 1: on incentives. A lot of its focuses on help, and 51 00:02:57,639 --> 00:02:59,639 Speaker 1: when I say incentives, I mean incentives in the way 52 00:02:59,639 --> 00:03:03,639 Speaker 1: I want toneurial incentives or business incentives or share market incentives. 53 00:03:03,760 --> 00:03:07,680 Speaker 1: A lot of the focuses on helping various quarters and 54 00:03:07,720 --> 00:03:10,640 Speaker 1: that is useful in many ways. But in terms of 55 00:03:10,680 --> 00:03:13,600 Speaker 1: the share market, do you think it will make much 56 00:03:13,639 --> 00:03:17,520 Speaker 1: difference to the ASX two hundred this year the nature 57 00:03:17,560 --> 00:03:18,840 Speaker 1: of the new government. 58 00:03:19,160 --> 00:03:20,040 Speaker 2: I think very little. 59 00:03:21,160 --> 00:03:25,120 Speaker 3: The major issue for the Australian equity market is productivity, 60 00:03:25,440 --> 00:03:30,680 Speaker 3: and yes Charmers said on Sunday that that is going 61 00:03:30,720 --> 00:03:33,359 Speaker 3: to be a focus. But unless we see signs of it, 62 00:03:33,760 --> 00:03:36,119 Speaker 3: and see some clear signs that they're going to turn 63 00:03:36,160 --> 00:03:39,320 Speaker 3: that around, I can't see much of a major effect 64 00:03:39,440 --> 00:03:42,440 Speaker 3: for the share market. In fact, the union movement is 65 00:03:42,880 --> 00:03:44,880 Speaker 3: sort of flexing their muscles a little bit and saying 66 00:03:45,240 --> 00:03:51,120 Speaker 3: they'd like to see some increases with respect to pay. 67 00:03:51,360 --> 00:03:53,160 Speaker 3: And I think that one of the areas we've looked 68 00:03:53,160 --> 00:03:55,640 Speaker 3: at on productivity, one of the worst areas on productivity 69 00:03:55,680 --> 00:03:58,880 Speaker 3: is actually in the mining sector, and that's been majorly 70 00:03:58,920 --> 00:04:01,920 Speaker 3: affected by the increases that you've seen there in wages 71 00:04:01,960 --> 00:04:02,640 Speaker 3: and conditions. 72 00:04:02,920 --> 00:04:06,000 Speaker 1: That's interesting, And they're at the bottom of the cycle anyway, 73 00:04:06,000 --> 00:04:09,720 Speaker 1: aren't they? Rio and BHP and Co. There Mind you, folks, 74 00:04:09,800 --> 00:04:11,600 Speaker 1: As an investor, it's worth keeping in mind that you 75 00:04:11,640 --> 00:04:13,880 Speaker 1: can get them at ten times earnings. They can get 76 00:04:13,920 --> 00:04:16,240 Speaker 1: Rio at ten times earnings these days, and BHP more 77 00:04:16,320 --> 00:04:20,840 Speaker 1: or less the same. The banks are on seventeen times earnings. 78 00:04:20,920 --> 00:04:24,720 Speaker 1: CBA is on nineteen times earnings. So if you're a 79 00:04:24,760 --> 00:04:29,800 Speaker 1: Warren Buffet style contrarian investor, that's your opportunity. Did you 80 00:04:30,520 --> 00:04:33,520 Speaker 1: on Buffers? It was interesting? That's it, the last of 81 00:04:33,560 --> 00:04:37,000 Speaker 1: the last. It's all over for Berkshire Hathaway. In terms 82 00:04:37,040 --> 00:04:41,640 Speaker 1: of the great the Golden period, Charliemonger and Warren Buffett. Yeah, 83 00:04:41,720 --> 00:04:43,400 Speaker 1: with that style of a bit, do you think we'll 84 00:04:43,400 --> 00:04:44,520 Speaker 1: ever see anything like him. 85 00:04:44,520 --> 00:04:47,320 Speaker 3: Again, it took him a long time to build a reputation. 86 00:04:47,520 --> 00:04:50,200 Speaker 3: So whoever it is, if we are too so, I 87 00:04:50,279 --> 00:04:51,880 Speaker 3: doubt it because it's going to take them a long 88 00:04:51,920 --> 00:04:55,240 Speaker 3: time to build a reputation. But you know, wow, Yeah, 89 00:04:55,480 --> 00:04:57,800 Speaker 3: both of them were phenomenal. It was It was incredible 90 00:04:57,920 --> 00:04:59,880 Speaker 3: and they have cult followings. 91 00:05:00,480 --> 00:05:02,120 Speaker 1: At the time of the GFC, which is when he 92 00:05:02,200 --> 00:05:04,960 Speaker 1: became a household in because he did those fabulous deals 93 00:05:04,960 --> 00:05:07,880 Speaker 1: any bank rode Gold mid Sex believe it or a 94 00:05:07,920 --> 00:05:10,920 Speaker 1: lot and got a great deal with them, and then 95 00:05:10,920 --> 00:05:14,000 Speaker 1: he became a worldwide figure. Yes, do you think we 96 00:05:14,080 --> 00:05:19,760 Speaker 1: have anything proxy for Warren Buffett in our marketer emerging 97 00:05:19,800 --> 00:05:22,200 Speaker 1: in overseas markets that you say there's someone that people 98 00:05:22,279 --> 00:05:24,600 Speaker 1: could do well to look at and keep an eye on. 99 00:05:25,040 --> 00:05:26,920 Speaker 3: Look, there's a lot of very good fund manager out there, 100 00:05:26,920 --> 00:05:28,880 Speaker 3: but none of that lake to be honest. 101 00:05:29,440 --> 00:05:32,320 Speaker 1: Okay, yes, And in terms of the ax we're just 102 00:05:32,360 --> 00:05:34,560 Speaker 1: talking about with the new government and the nature of 103 00:05:34,640 --> 00:05:38,520 Speaker 1: things you mentioned productivity, which is something it's not as 104 00:05:38,560 --> 00:05:41,559 Speaker 1: you say, it would be very good for share market 105 00:05:41,560 --> 00:05:44,039 Speaker 1: disc companies if there was improved productivity, but it's a 106 00:05:44,080 --> 00:05:48,800 Speaker 1: long bow. Maybe more specifically, are there areas that you 107 00:05:49,000 --> 00:05:52,120 Speaker 1: think you would go closer to or away from. With 108 00:05:52,279 --> 00:05:54,920 Speaker 1: the nature of the government we have, I'm thinking of 109 00:05:55,080 --> 00:05:58,159 Speaker 1: even spot checks, like I say, critical minerals. I saw 110 00:05:58,160 --> 00:06:01,200 Speaker 1: the line as Chief saying on a second, you know, 111 00:06:01,240 --> 00:06:03,520 Speaker 1: if you're getting in there, if the government is stuff 112 00:06:03,560 --> 00:06:06,560 Speaker 1: piling critical miners, that's anti market. You saw something like 113 00:06:06,600 --> 00:06:09,200 Speaker 1: them lenders mortgage insurance people saying, hang on a second, 114 00:06:09,200 --> 00:06:13,559 Speaker 1: if you're going to provide free mortgage insurance cover for 115 00:06:13,720 --> 00:06:15,480 Speaker 1: every single home buyer, where there it goes to the 116 00:06:15,520 --> 00:06:19,080 Speaker 1: lender's insurance market. Do you think that the market interference 117 00:06:19,360 --> 00:06:23,360 Speaker 1: that we will get for sure in a new administration, 118 00:06:24,160 --> 00:06:25,640 Speaker 1: how might that affect things? 119 00:06:26,040 --> 00:06:28,159 Speaker 3: I think, Look, the government has said on critical minerals 120 00:06:28,160 --> 00:06:30,279 Speaker 3: they're going to look at stockpiling, but I think we 121 00:06:30,400 --> 00:06:33,480 Speaker 3: need to look at the long term and where critical 122 00:06:33,520 --> 00:06:36,360 Speaker 3: minerals have traditionally been supplied from, and China's been a 123 00:06:36,440 --> 00:06:39,280 Speaker 3: large supplier of that to the United States. So Australia 124 00:06:39,320 --> 00:06:41,839 Speaker 3: is going to benefit longer term in this, and hence 125 00:06:41,880 --> 00:06:45,039 Speaker 3: why you know, I think Trump's been so keen to 126 00:06:45,040 --> 00:06:48,000 Speaker 3: do a deal in Ukraine it is again to tie 127 00:06:48,080 --> 00:06:50,520 Speaker 3: up critical minerals. But Australia's also got a lot of 128 00:06:50,520 --> 00:06:54,520 Speaker 3: critical minerals, so longer term and as a supply to 129 00:06:54,880 --> 00:06:57,440 Speaker 3: places like the United States, we're going to see benefit 130 00:06:57,480 --> 00:07:00,320 Speaker 3: from that. But the second thing is, as you're right said, 131 00:07:00,440 --> 00:07:03,720 Speaker 3: interference is generally a negative, but to what extent You've 132 00:07:03,720 --> 00:07:06,719 Speaker 3: got to look just can't take a blanket picture and 133 00:07:06,720 --> 00:07:08,719 Speaker 3: say well, this is going to have a negative effect. 134 00:07:09,200 --> 00:07:11,240 Speaker 3: You've got to look at what percentage of earnings. 135 00:07:10,880 --> 00:07:11,640 Speaker 2: This is as well? 136 00:07:12,120 --> 00:07:16,520 Speaker 1: Okay, And in terms of energy transition again, Albanezi government 137 00:07:16,560 --> 00:07:18,880 Speaker 1: is much more on the front foot about energy transition 138 00:07:19,400 --> 00:07:21,880 Speaker 1: and that has two sides. It means moving away from coal, 139 00:07:22,240 --> 00:07:24,760 Speaker 1: moving towards other new forms of energy. 140 00:07:25,000 --> 00:07:27,680 Speaker 3: Well, yes, and you hope that gas comes into this 141 00:07:27,760 --> 00:07:31,680 Speaker 3: because we need to have baseload and one of the 142 00:07:31,720 --> 00:07:34,600 Speaker 3: reasons why people say the Abanese government has been so 143 00:07:34,680 --> 00:07:36,560 Speaker 3: negative on gas is because of the Greens. Well, if 144 00:07:36,560 --> 00:07:41,320 Speaker 3: the Greens have a reduced effect in this coming parliament, 145 00:07:41,560 --> 00:07:46,160 Speaker 3: you hope that common sense prevails with respect to a 146 00:07:46,240 --> 00:07:50,560 Speaker 3: cleaner base, low power future, and that being through gas. 147 00:07:51,000 --> 00:07:53,520 Speaker 3: We've got a lot of it and we're exporting a 148 00:07:53,520 --> 00:07:57,560 Speaker 3: lot of it. So is there some rethought towards that What. 149 00:07:57,480 --> 00:08:04,160 Speaker 1: Did you think of Stuart's tension that the signature scheme 150 00:08:04,280 --> 00:08:09,440 Speaker 1: of the Albanez government in the election campaign of universal 151 00:08:10,040 --> 00:08:12,680 Speaker 1: first home buyer scheme or anyone buy your house for 152 00:08:12,760 --> 00:08:15,520 Speaker 1: the first time can act a five percent deposit. It 153 00:08:15,560 --> 00:08:18,760 Speaker 1: doesn't start till January. People will stay away from that 154 00:08:18,800 --> 00:08:21,720 Speaker 1: market till January. They will pour into it in January. 155 00:08:21,840 --> 00:08:24,040 Speaker 1: We will get a spike in house prices in January. 156 00:08:24,160 --> 00:08:25,600 Speaker 1: What did you think of that theory? 157 00:08:26,120 --> 00:08:26,840 Speaker 2: I agree on that. 158 00:08:27,040 --> 00:08:29,640 Speaker 3: I think that everything's based on demand and supply, and 159 00:08:29,680 --> 00:08:32,880 Speaker 3: therefore down at those lower areas you will see that 160 00:08:32,960 --> 00:08:36,679 Speaker 3: spike and it's down to affordability, and I agree with 161 00:08:36,720 --> 00:08:38,680 Speaker 3: his whole logic and how he's looked at that, and 162 00:08:38,679 --> 00:08:41,400 Speaker 3: then therefore you could see a temporary sort of lull 163 00:08:41,400 --> 00:08:44,960 Speaker 3: in demand. But hence after the first of January you 164 00:08:44,960 --> 00:08:46,079 Speaker 3: could see that spik up. 165 00:08:46,200 --> 00:08:48,600 Speaker 1: Okay, you get a spike in demand which would actually 166 00:08:48,600 --> 00:08:51,880 Speaker 1: push our prices in that layer correct absolutely, being the 167 00:08:51,880 --> 00:08:55,400 Speaker 1: first home buyer layer, which is under a million yep basically, 168 00:08:55,800 --> 00:08:58,640 Speaker 1: and that would vary obviously around the country, but very generally. 169 00:08:58,840 --> 00:09:00,960 Speaker 1: All right, now, folks, the things that we want to 170 00:09:01,000 --> 00:09:05,080 Speaker 1: talk to will obviously particularly about is your tax outlook 171 00:09:05,440 --> 00:09:09,280 Speaker 1: under the new administration, the changes they have already mentioned 172 00:09:09,400 --> 00:09:15,240 Speaker 1: and the changes that may roll from the initial experiment 173 00:09:15,320 --> 00:09:17,760 Speaker 1: on souper, which is so important. We're going to talk 174 00:09:17,760 --> 00:09:19,640 Speaker 1: about that after the break. We'll be back in a moment. 175 00:09:30,840 --> 00:09:34,479 Speaker 1: Hello and welcome back to The Australian's Money Puzzle podcast. 176 00:09:34,640 --> 00:09:37,760 Speaker 1: James Kirby talking to Will Hamilton of Hamilton Wealth Partner's 177 00:09:37,840 --> 00:09:41,920 Speaker 1: regular contributor to the Australian Wealth Section and of course 178 00:09:41,960 --> 00:09:45,120 Speaker 1: regular on the show. Now Will so when Jeff Wilson 179 00:09:45,200 --> 00:09:47,680 Speaker 1: was on last week, and we've got some interesting questions 180 00:09:47,720 --> 00:09:50,559 Speaker 1: about his arrival on the show in the next segment. 181 00:09:50,640 --> 00:09:53,319 Speaker 1: But he assumed it was going to be a hung parliament, 182 00:09:53,320 --> 00:09:56,240 Speaker 1: and he assumed that he would have to chase around 183 00:09:56,800 --> 00:09:59,840 Speaker 1: and pressure as a lobbyist, or at least as an 184 00:10:00,080 --> 00:10:02,800 Speaker 1: to this. He was assuming that you'd have to deal 185 00:10:02,840 --> 00:10:05,800 Speaker 1: with all these crossbenchers. But the way it's shaping up 186 00:10:06,280 --> 00:10:08,360 Speaker 1: as we speak this morning is really quite different than 187 00:10:08,360 --> 00:10:10,760 Speaker 1: it was even a week ago. Number One, the government 188 00:10:10,880 --> 00:10:14,080 Speaker 1: they will have to reintroduce this bill, and just to 189 00:10:14,120 --> 00:10:17,280 Speaker 1: clarify for all listeners, because I was amazed how some 190 00:10:17,320 --> 00:10:19,680 Speaker 1: people were really only starting to figure this out last week. 191 00:10:19,760 --> 00:10:23,400 Speaker 1: Judging by our correspondence, it's a new tax fifteen percent 192 00:10:23,800 --> 00:10:26,760 Speaker 1: on earnings above three million in super be that as 193 00:10:26,840 --> 00:10:30,000 Speaker 1: at me. What is driving people up the wall, including Jeff, 194 00:10:30,240 --> 00:10:34,920 Speaker 1: was that it's based on paper gains, paper gains, unrealized profits. 195 00:10:35,120 --> 00:10:38,120 Speaker 1: We haven't had that before. It's really going to change 196 00:10:38,160 --> 00:10:40,120 Speaker 1: the nature of things if we bring it in in 197 00:10:40,160 --> 00:10:42,200 Speaker 1: the way they have it planned and it's not to 198 00:10:42,240 --> 00:10:45,520 Speaker 1: be indexed. If it's not indexed, it means that tens 199 00:10:45,559 --> 00:10:48,240 Speaker 1: of thousands of vestors will be brought in each year 200 00:10:48,320 --> 00:10:50,840 Speaker 1: to the net. But here's the thing what we know 201 00:10:50,920 --> 00:10:52,959 Speaker 1: so far is it now looks like that if they 202 00:10:52,960 --> 00:10:55,360 Speaker 1: do reintroduce it, and they will, we know that that. 203 00:10:55,440 --> 00:10:58,000 Speaker 1: We've got confirmation this week that they will reintroduce it, 204 00:10:58,000 --> 00:11:00,400 Speaker 1: it will sail through the Lowerhouse because they have huge 205 00:11:00,400 --> 00:11:03,000 Speaker 1: majority there now. So it's all about the Senate and 206 00:11:03,040 --> 00:11:07,080 Speaker 1: dealing with the Greens. The Greens say if they want 207 00:11:07,120 --> 00:11:09,280 Speaker 1: to get this through, they want to bring it down, 208 00:11:09,440 --> 00:11:12,000 Speaker 1: they want to bring the threashold down from three million 209 00:11:12,040 --> 00:11:14,720 Speaker 1: to two million. What are we looking at here. 210 00:11:14,720 --> 00:11:17,760 Speaker 3: Well, that's the level of the transfer balance cap. So 211 00:11:17,880 --> 00:11:20,640 Speaker 3: at the moment that transfer balance cap from the first 212 00:11:20,679 --> 00:11:22,760 Speaker 3: July twenty twenty five is going to kick in at 213 00:11:22,960 --> 00:11:25,440 Speaker 3: two million dollars, So we're seeing on hundred thousand dollars increase. 214 00:11:26,280 --> 00:11:29,520 Speaker 3: It will capture a lot more. I would hope that 215 00:11:29,559 --> 00:11:32,000 Speaker 3: this is not the case, because I think it's going 216 00:11:32,040 --> 00:11:36,720 Speaker 3: to create mayhem amongst our investors. You know, we're already 217 00:11:36,720 --> 00:11:39,280 Speaker 3: looking ourselves at the minute we get some degree of 218 00:11:39,320 --> 00:11:42,280 Speaker 3: clarity on the legislation, make sure there's no changes. We're 219 00:11:42,280 --> 00:11:45,920 Speaker 3: going to be holding some things for clients because it's 220 00:11:45,960 --> 00:11:47,400 Speaker 3: going to be a major issue for us. 221 00:11:47,559 --> 00:11:50,160 Speaker 1: At three million, what's mayhem? What do you mean by mayhem? 222 00:11:50,480 --> 00:11:52,400 Speaker 3: Well, you're bringing it down to just a lower level, 223 00:11:52,400 --> 00:11:54,600 Speaker 3: and it's going to capture. If you brought it down 224 00:11:54,640 --> 00:11:57,040 Speaker 3: to two million, like the Greens want, the capture is 225 00:11:57,080 --> 00:11:59,800 Speaker 3: going to be that much more substantial with respect to 226 00:11:59,800 --> 00:12:03,800 Speaker 3: those that are affected and the unrealized gains I think 227 00:12:03,920 --> 00:12:04,960 Speaker 3: is a major. 228 00:12:04,640 --> 00:12:06,280 Speaker 2: Issue at the moment. 229 00:12:06,320 --> 00:12:08,400 Speaker 3: Of the way I've been looking at it is that 230 00:12:08,440 --> 00:12:11,040 Speaker 3: they're saying it's not index, that's three and therefore the 231 00:12:11,040 --> 00:12:15,120 Speaker 3: transfer balance cap level is the index. So we just said, 232 00:12:15,120 --> 00:12:17,000 Speaker 3: what you're seeing an increase of one hundred thousand dollars. 233 00:12:17,000 --> 00:12:20,520 Speaker 3: So I've been looking at there being this indexing until 234 00:12:20,559 --> 00:12:23,000 Speaker 3: you get that transfer balance cap at three million dollars. 235 00:12:23,000 --> 00:12:26,920 Speaker 3: Then you hope common sense prevails and you see the 236 00:12:27,000 --> 00:12:30,160 Speaker 3: three million dollar level as the starting to go up 237 00:12:30,200 --> 00:12:31,960 Speaker 3: because it effectively is the TBC. 238 00:12:32,400 --> 00:12:35,280 Speaker 1: So just to clarify to the average list here and 239 00:12:35,360 --> 00:12:37,280 Speaker 1: tell me if I'm wrong, Will, But what you're saying 240 00:12:37,360 --> 00:12:39,760 Speaker 1: is you don't pay tax in super anyway up to 241 00:12:39,800 --> 00:12:43,960 Speaker 1: two million, yep, But that's indexed, and the new tax 242 00:12:44,160 --> 00:12:47,439 Speaker 1: is you actually paid double tax. Yes, you pay thirty 243 00:12:47,520 --> 00:12:49,840 Speaker 1: roll than fifteen after three ye but if it's not 244 00:12:49,960 --> 00:12:52,160 Speaker 1: index more and more people go in there anyway, So 245 00:12:52,240 --> 00:12:54,080 Speaker 1: one way or another, before you know where you are, 246 00:12:54,240 --> 00:12:57,440 Speaker 1: it becomes effectively a thirty percent tax on two million 247 00:12:57,960 --> 00:13:00,760 Speaker 1: over the passage of time, even if the Greens nothing. 248 00:13:00,760 --> 00:13:04,480 Speaker 3: Correct, right, because it's effectively well, it's like bracket creep 249 00:13:04,559 --> 00:13:08,160 Speaker 3: at the personal levels. That's what it is, and that's 250 00:13:08,200 --> 00:13:11,360 Speaker 3: why people are very concerned on that level because the 251 00:13:11,440 --> 00:13:15,640 Speaker 3: fact is these are investment assets. You take lare of 252 00:13:16,160 --> 00:13:20,280 Speaker 3: investment seven eight percent, you're looking at doubling every ten years, 253 00:13:20,280 --> 00:13:22,839 Speaker 3: et cetera. So you know this is a major issue 254 00:13:22,840 --> 00:13:24,880 Speaker 3: and then you've got unrealized gains on that as well, 255 00:13:24,920 --> 00:13:28,000 Speaker 3: which is just grossly unfair because it has a major 256 00:13:28,000 --> 00:13:31,160 Speaker 3: effect on cash flow. Yes, the fact is people made 257 00:13:31,200 --> 00:13:32,360 Speaker 3: decisions based on. 258 00:13:32,360 --> 00:13:33,559 Speaker 2: The law at the time. 259 00:13:33,679 --> 00:13:34,880 Speaker 1: That's right for their life. 260 00:13:35,000 --> 00:13:35,400 Speaker 2: Correct. 261 00:13:35,840 --> 00:13:39,880 Speaker 3: Yeah, and then though suddenly everything's changed and that has 262 00:13:39,920 --> 00:13:40,920 Speaker 3: a major effect on them. 263 00:13:41,280 --> 00:13:41,600 Speaker 2: People. 264 00:13:42,160 --> 00:13:45,760 Speaker 3: I've seen this some questions with respect to farmers. Farmers 265 00:13:45,800 --> 00:13:48,480 Speaker 3: have an asset in there with probably very little else 266 00:13:48,640 --> 00:13:52,120 Speaker 3: in a lot of cases being the farmland, and therefore 267 00:13:52,160 --> 00:13:55,120 Speaker 3: if that value goes up, they need to meet that liability. 268 00:13:55,120 --> 00:13:56,560 Speaker 3: But where is the cash flow to do that? 269 00:13:57,320 --> 00:14:00,480 Speaker 1: Explain when you get your bill on your page or gain. 270 00:14:01,600 --> 00:14:05,120 Speaker 1: Apart from the obvious frustrations of that. Yep, you must 271 00:14:05,320 --> 00:14:10,560 Speaker 1: pay it there and then to the tax office, and 272 00:14:10,679 --> 00:14:13,720 Speaker 1: that has all sorts of ramifications. You must pay it 273 00:14:13,800 --> 00:14:16,880 Speaker 1: either as a person, that is you will Hamilton have 274 00:14:16,920 --> 00:14:18,760 Speaker 1: to write a check for the ATO, or you have 275 00:14:18,840 --> 00:14:20,640 Speaker 1: to take it out of your superfund. 276 00:14:20,400 --> 00:14:25,280 Speaker 3: Where you're actually assessed individually on that unlike below three million. 277 00:14:25,840 --> 00:14:31,520 Speaker 3: And yes, you are given leave to source that liability 278 00:14:31,840 --> 00:14:32,840 Speaker 3: from your super fund. 279 00:14:33,080 --> 00:14:34,640 Speaker 1: You can take the money out and pay the bill 280 00:14:34,680 --> 00:14:35,560 Speaker 1: from your superfund. 281 00:14:35,720 --> 00:14:36,640 Speaker 2: Correct. Yeah. 282 00:14:36,840 --> 00:14:38,640 Speaker 1: So you're taking money out of your super fund to 283 00:14:38,640 --> 00:14:44,320 Speaker 1: pay a bill on gains that were possibly imaginary because 284 00:14:44,360 --> 00:14:48,800 Speaker 1: their paper gains correct. Yeah, so this is really the problem. 285 00:14:48,840 --> 00:14:50,920 Speaker 1: This is what people don't like. But what's the chances 286 00:14:51,000 --> 00:14:54,400 Speaker 1: that this will broaden this technique of taxing paper gains. 287 00:14:54,640 --> 00:14:56,920 Speaker 3: Well, to go back a step first before we get 288 00:14:56,960 --> 00:14:59,000 Speaker 3: onto that. The thing is, you know, we've just been 289 00:14:59,040 --> 00:15:03,160 Speaker 3: through MAC corrections and therefore the people are going to 290 00:15:03,200 --> 00:15:06,640 Speaker 3: have paper losses. Yes, but you don't get a refund. 291 00:15:07,440 --> 00:15:11,080 Speaker 3: All you get is an offset of future tax liabilities 292 00:15:11,600 --> 00:15:12,200 Speaker 3: like CGT. 293 00:15:12,400 --> 00:15:15,800 Speaker 1: You can't get a comp You say, listen, I paid 294 00:15:16,040 --> 00:15:18,840 Speaker 1: twenty grand in tax last year for something I never 295 00:15:19,480 --> 00:15:22,680 Speaker 1: got to play with or cash in, and now it's 296 00:15:22,760 --> 00:15:25,640 Speaker 1: plunged and I've got a loss. Can I have compensation? 297 00:15:25,760 --> 00:15:28,720 Speaker 1: And they say, no compensation. You can only carry this 298 00:15:28,840 --> 00:15:30,320 Speaker 1: forward against future gains. 299 00:15:30,480 --> 00:15:33,880 Speaker 2: Yeah. Correct, And then it's referred to as division too NAN. 300 00:15:33,840 --> 00:15:36,600 Speaker 3: Six and under that, if you've got a loss three 301 00:15:36,720 --> 00:15:40,080 Speaker 3: super fund but you've got a tax liability from other assets, 302 00:15:40,080 --> 00:15:43,520 Speaker 3: you can't offset that loss, even though you're assessed personally, 303 00:15:44,200 --> 00:15:48,120 Speaker 3: you can't offset that loss against liabilities that you've got 304 00:15:48,680 --> 00:15:49,720 Speaker 3: from other areas. 305 00:15:50,240 --> 00:15:53,120 Speaker 1: And that you see as tax inequitable to put it, 306 00:15:53,160 --> 00:15:56,720 Speaker 1: my lig it is yeah yeah, yeah yeah, or on 307 00:15:56,840 --> 00:15:59,440 Speaker 1: as you were saying, grossly unfair at the start. And 308 00:15:59,640 --> 00:16:01,120 Speaker 1: I think this is the point I'm trying to make 309 00:16:01,160 --> 00:16:04,120 Speaker 1: to listeners and to readers in the Australian. It's not 310 00:16:04,280 --> 00:16:10,200 Speaker 1: the dollar figure here, it's the method of taxation. Okay. Now, 311 00:16:10,400 --> 00:16:12,720 Speaker 1: one thing that's yet to be drawn out, and I 312 00:16:12,800 --> 00:16:14,800 Speaker 1: think it's very interesting if for anyone who has a 313 00:16:14,840 --> 00:16:18,160 Speaker 1: self managed super fund. The Greens who have now got 314 00:16:18,720 --> 00:16:21,400 Speaker 1: though you might think because Adam Bant, I think he's gone, 315 00:16:21,960 --> 00:16:24,440 Speaker 1: and because they're not in the lower house of any 316 00:16:24,920 --> 00:16:26,440 Speaker 1: they are not a power in the lower house, but 317 00:16:26,440 --> 00:16:28,920 Speaker 1: they're a power in the upper house. The other part 318 00:16:28,960 --> 00:16:33,120 Speaker 1: thing they wanted in their agenda was to scrap the 319 00:16:33,200 --> 00:16:36,840 Speaker 1: ability to borrow money in super what's it called LBR. 320 00:16:38,880 --> 00:16:41,120 Speaker 1: So most people who have a super fund get it 321 00:16:41,240 --> 00:16:45,320 Speaker 1: to borrow an SMSF and they borrow often to buy 322 00:16:45,360 --> 00:16:47,920 Speaker 1: property and that's been allowed for years and years and 323 00:16:48,000 --> 00:16:50,640 Speaker 1: years and every government has sort of toied along, but 324 00:16:50,680 --> 00:16:53,840 Speaker 1: they've signed it off. The Greens want that scrapped. Do 325 00:16:53,880 --> 00:16:56,400 Speaker 1: you think albinezy government will scrap it? 326 00:16:57,160 --> 00:16:59,960 Speaker 3: So First of all, in a super fund, you cannot 327 00:17:00,080 --> 00:17:03,360 Speaker 3: negatively gear, and our said it has to be positively geared. 328 00:17:03,640 --> 00:17:05,120 Speaker 2: So just we need to remember that. 329 00:17:05,240 --> 00:17:07,480 Speaker 3: So yes, you can borrow up to a certain level, 330 00:17:07,480 --> 00:17:10,280 Speaker 3: but you also have to have a positive cash flow. 331 00:17:10,680 --> 00:17:12,439 Speaker 3: One of the things the government has said is that 332 00:17:12,480 --> 00:17:15,960 Speaker 3: they won't introduce any new taxes, but they haven't said 333 00:17:16,119 --> 00:17:18,160 Speaker 3: that they wouldn't remove tax breaks. 334 00:17:18,680 --> 00:17:22,400 Speaker 1: That's a very good point. Well, that is a gem, yes. 335 00:17:22,800 --> 00:17:27,480 Speaker 3: So what I'm worried about is, yes, what you've just said, 336 00:17:28,680 --> 00:17:32,000 Speaker 3: and then there's the double breaks that you have in 337 00:17:32,000 --> 00:17:35,920 Speaker 3: investment property taxes. I doubt they'll play with negative gearing. 338 00:17:35,960 --> 00:17:39,320 Speaker 3: I think that was done by bull keating and reversed. 339 00:17:39,800 --> 00:17:43,359 Speaker 3: But I'm wondering about this CGT relief and removing that. 340 00:17:43,640 --> 00:17:46,640 Speaker 3: So I'm looking at things saying, well, they haven't said 341 00:17:46,680 --> 00:17:49,480 Speaker 3: they wouldn't remove tax breaks, yes, and I'm wondering which 342 00:17:49,880 --> 00:17:53,240 Speaker 3: how they will play with this. And I think removing 343 00:17:53,280 --> 00:17:57,160 Speaker 3: CGT relief is a lot neater because you know, what's 344 00:17:57,160 --> 00:17:59,359 Speaker 3: been previously proposed by the Greens on negative gearing was 345 00:17:59,359 --> 00:18:01,840 Speaker 3: you're allowed or two properties or something like that to 346 00:18:01,960 --> 00:18:04,520 Speaker 3: negative gear, and whereas with this is you just draw 347 00:18:04,560 --> 00:18:07,439 Speaker 3: a line, pray this period you're allowed at post this period. 348 00:18:07,480 --> 00:18:09,840 Speaker 1: Sorry, it's gone, and you can stand in front of 349 00:18:09,840 --> 00:18:11,879 Speaker 1: the cameras and say we said no new taxes. This 350 00:18:11,960 --> 00:18:14,520 Speaker 1: is not a new tax. This is a restriction of 351 00:18:14,560 --> 00:18:16,879 Speaker 1: an existing tax. And most of our listeners would know 352 00:18:17,080 --> 00:18:20,920 Speaker 1: CGT as. You know how it works capital gains tax. 353 00:18:21,400 --> 00:18:23,640 Speaker 1: If you hold an acid and you said it under 354 00:18:23,680 --> 00:18:25,920 Speaker 1: a year, it's a fifty percent tax. If you hold 355 00:18:25,960 --> 00:18:27,959 Speaker 1: it for more than a year, it's twenty five percent. 356 00:18:28,040 --> 00:18:29,960 Speaker 1: That's why the vast majority of people will wait for 357 00:18:30,000 --> 00:18:31,560 Speaker 1: more than a year before they said an asset and 358 00:18:31,640 --> 00:18:35,480 Speaker 1: assid trading shares or something. I suppose well, thinking out 359 00:18:35,520 --> 00:18:38,720 Speaker 1: loud here, there's great scope for horse trading here, you 360 00:18:38,800 --> 00:18:42,359 Speaker 1: might say to the Greens, put this tax through on 361 00:18:42,400 --> 00:18:45,040 Speaker 1: the Super, will you, because we need the two three 362 00:18:45,119 --> 00:18:47,760 Speaker 1: billion a year revenue. It's baked into the books and 363 00:18:47,840 --> 00:18:51,480 Speaker 1: we will scrap the lending in super for you. That's 364 00:18:51,480 --> 00:18:53,000 Speaker 1: a possibility, isn't it. Surely? 365 00:18:53,600 --> 00:18:56,040 Speaker 3: I think with the majority of the government's gosh, you 366 00:18:56,119 --> 00:18:58,359 Speaker 3: might see the grains and even the coalitions that to 367 00:18:58,400 --> 00:19:02,159 Speaker 3: be a lot more cooperative on certain legislation. Now, I 368 00:19:02,200 --> 00:19:05,440 Speaker 3: wouldn't expect the Coalition, especially given what Tim Wilson said, 369 00:19:06,040 --> 00:19:08,119 Speaker 3: who is expected to win Godstein. 370 00:19:08,400 --> 00:19:12,600 Speaker 1: Here's what I mean. He had a press conference about 371 00:19:12,600 --> 00:19:14,680 Speaker 1: winning it yesterday and he has won it. 372 00:19:14,800 --> 00:19:17,960 Speaker 3: Yeah, but given what he has said, I don't think 373 00:19:18,000 --> 00:19:21,360 Speaker 3: you're going to get any horse trading from the Coalition 374 00:19:21,480 --> 00:19:25,040 Speaker 3: on this tax in particular. But I think on a 375 00:19:25,040 --> 00:19:28,560 Speaker 3: bigger picture in the Parliament, the government may find cooperation 376 00:19:28,800 --> 00:19:31,480 Speaker 3: between either the Greens or the Coalition compared to just 377 00:19:31,600 --> 00:19:33,080 Speaker 3: saying no to everything. 378 00:19:33,000 --> 00:19:35,480 Speaker 1: Which they did previously. So you're saying that the horse 379 00:19:35,560 --> 00:19:37,840 Speaker 1: trading will be between the Labor and the Greens to 380 00:19:37,840 --> 00:19:39,960 Speaker 1: get these things done in the Senate. 381 00:19:39,840 --> 00:19:42,480 Speaker 3: Yeah, I think you will see a degree of cooperation. 382 00:19:42,600 --> 00:19:45,719 Speaker 3: And therefore, as you just said, the reversal of lending 383 00:19:46,520 --> 00:19:49,600 Speaker 3: in super funds and maybe some other things down the track, 384 00:19:49,760 --> 00:19:52,560 Speaker 3: we may seekey and like for a minute a CG 385 00:19:52,680 --> 00:19:56,080 Speaker 3: two relief, it was given for investing in productive assets, 386 00:19:56,080 --> 00:20:01,000 Speaker 3: and the government may also argue will is investment housing? 387 00:20:01,280 --> 00:20:02,399 Speaker 3: Is that a productive asset? 388 00:20:03,040 --> 00:20:06,880 Speaker 1: Yeah, that's a good point. Yeah, yeah, absolutely, Okay, Well 389 00:20:06,880 --> 00:20:10,160 Speaker 1: we will see on that interesting and Wilson a course 390 00:20:10,320 --> 00:20:14,840 Speaker 1: surprise winner and one of the few Libs that senior 391 00:20:14,880 --> 00:20:18,520 Speaker 1: Libs that has managed to come through this election in 392 00:20:18,600 --> 00:20:21,600 Speaker 1: better shape. The only reason I bring this up, folks, 393 00:20:21,680 --> 00:20:26,480 Speaker 1: is because you may remember that Wilson was the politician 394 00:20:27,320 --> 00:20:31,640 Speaker 1: that was most clearly identified with the Frank Dividend campaign 395 00:20:31,800 --> 00:20:35,240 Speaker 1: that time in the Morrison government, and he has got 396 00:20:35,320 --> 00:20:38,720 Speaker 1: back in. He's a he's loving to be assistant treasurer. 397 00:20:38,880 --> 00:20:43,719 Speaker 1: Assistant treasurer opposition treasure he'd loved to be assistant treasure 398 00:20:44,280 --> 00:20:46,600 Speaker 1: but opposition treasure all right, we don't want to go 399 00:20:46,640 --> 00:20:50,280 Speaker 1: to foreign politics, but it's worth knowing these key issues. 400 00:20:50,440 --> 00:20:52,439 Speaker 1: All right. We'll be back in a moment, folks, and 401 00:20:52,480 --> 00:20:57,280 Speaker 1: we've got some really really good correspondence about these issues 402 00:20:57,359 --> 00:21:09,200 Speaker 1: we've just been talking about. Back in a moment. Hello, 403 00:21:09,280 --> 00:21:12,960 Speaker 1: and welcome back to The Australian's Money Puzzle podcast. James 404 00:21:13,040 --> 00:21:16,280 Speaker 1: Kirby talking to Will Hamilton of Hamilton Worth, Partner's regular 405 00:21:16,480 --> 00:21:20,399 Speaker 1: contributor to the Australian Word Section and of course regular 406 00:21:20,480 --> 00:21:23,400 Speaker 1: on the show. Can you see the questions on the screen. 407 00:21:23,080 --> 00:21:24,160 Speaker 2: Will I've got them? 408 00:21:24,240 --> 00:21:27,960 Speaker 1: Yes, okay, I'm going to enjoy you reading that first 409 00:21:28,000 --> 00:21:30,840 Speaker 1: one from Oh the name is missing. We've sought that 410 00:21:30,840 --> 00:21:31,320 Speaker 1: out later. 411 00:21:31,640 --> 00:21:33,200 Speaker 2: Yes, it's a long question. 412 00:21:33,520 --> 00:21:35,600 Speaker 1: It's a long question, but it's worth reading. 413 00:21:35,560 --> 00:21:36,080 Speaker 2: It sure is. 414 00:21:36,280 --> 00:21:38,280 Speaker 3: We've covered some of it, but the recent podcast with 415 00:21:38,400 --> 00:21:41,320 Speaker 3: Jeff Wilson alerted me to the text of unrealized capital 416 00:21:41,359 --> 00:21:45,240 Speaker 3: gains and superannuation accounts. I believe that superannuation was conceived 417 00:21:45,240 --> 00:21:47,119 Speaker 3: by pul Keating to take the pressure off the government 418 00:21:47,200 --> 00:21:50,320 Speaker 3: pension liabilities in the future. I provide a way for 419 00:21:50,359 --> 00:21:53,879 Speaker 3: people to accumulate enough wealth to retire in dignity and 420 00:21:53,920 --> 00:21:57,000 Speaker 3: not rely on the pension. What I do not think 421 00:21:57,080 --> 00:21:59,120 Speaker 3: was intended to do is provide a means by which 422 00:21:59,160 --> 00:22:02,199 Speaker 3: people can shelter large amounts of generation wealth in a 423 00:22:02,240 --> 00:22:05,640 Speaker 3: lower tax environment. I can't believe that people could put 424 00:22:05,720 --> 00:22:08,639 Speaker 3: large farms or properties into self managed super funds. If 425 00:22:08,640 --> 00:22:11,360 Speaker 3: they have, I have no sympathy for them, as they're 426 00:22:11,359 --> 00:22:13,760 Speaker 3: avoiding paying their fair share of tax no capital gains 427 00:22:13,840 --> 00:22:16,200 Speaker 3: tax on a property that is sold once in pension phase. 428 00:22:16,240 --> 00:22:18,520 Speaker 3: I assume, as is the case with equities, a three 429 00:22:18,560 --> 00:22:21,520 Speaker 3: million super balance should at worst provide a healthy one 430 00:22:21,600 --> 00:22:24,240 Speaker 3: hundred and fifty thousand dollars tax free income and retirement. 431 00:22:24,680 --> 00:22:27,440 Speaker 3: How much does an individual need for a comfortable retirement 432 00:22:27,480 --> 00:22:31,119 Speaker 3: post sixty years of age? So good on the Labor Party, 433 00:22:31,640 --> 00:22:33,240 Speaker 3: with help of the Greens and their balance of power 434 00:22:33,240 --> 00:22:35,360 Speaker 3: in the Senate, will see the legislation enacted. 435 00:22:36,000 --> 00:22:40,280 Speaker 1: Now, our listener, apologies the name has fallen off. We 436 00:22:40,359 --> 00:22:42,359 Speaker 1: will get that, but I know it was a mail. 437 00:22:42,800 --> 00:22:45,320 Speaker 1: He didn't believe basically that people put farms into s 438 00:22:45,440 --> 00:22:48,160 Speaker 1: manefs and said they were tax avoiding if they were 439 00:22:48,160 --> 00:22:51,880 Speaker 1: doing so, what's your view on that statement? 440 00:22:52,560 --> 00:22:56,480 Speaker 3: They did it really for asset protection on generations. I 441 00:22:56,520 --> 00:22:58,720 Speaker 3: think that's a big thing on for farms. 442 00:22:58,760 --> 00:23:01,520 Speaker 1: But his point is super cut be used for that well. 443 00:23:01,720 --> 00:23:04,280 Speaker 3: As I said before, the fact is they did things 444 00:23:04,359 --> 00:23:06,320 Speaker 3: under the laws that existed at the point in time, 445 00:23:06,359 --> 00:23:08,159 Speaker 3: and I think don't think you should be penalized for 446 00:23:08,160 --> 00:23:10,000 Speaker 3: the laws that existed at the point in time. There 447 00:23:10,000 --> 00:23:12,760 Speaker 3: is no doubt, you know, And I'm aware of even 448 00:23:12,800 --> 00:23:15,480 Speaker 3: some clients of ours that have very very excessive balances 449 00:23:15,640 --> 00:23:19,640 Speaker 3: in super and it's interesting their viewers. It's worked, yes, however, 450 00:23:20,800 --> 00:23:22,520 Speaker 3: good on it for the time, and some of them 451 00:23:22,520 --> 00:23:26,640 Speaker 3: do say we've got X in here and that's excess 452 00:23:26,680 --> 00:23:28,879 Speaker 3: to really what should be allowed. So you know the 453 00:23:28,920 --> 00:23:30,280 Speaker 3: fact is the laws allowed it. 454 00:23:30,680 --> 00:23:33,280 Speaker 1: They were taught by their advisors here's the law. They 455 00:23:33,320 --> 00:23:37,160 Speaker 1: were told by previous administrations put poor money into super 456 00:23:37,240 --> 00:23:40,760 Speaker 1: I mean Peter Costello, who everyone thinks was a great treasurer, said, 457 00:23:41,000 --> 00:23:43,359 Speaker 1: put in as much as you like, which must have 458 00:23:43,400 --> 00:23:45,600 Speaker 1: been greatful, because all you can put in now is 459 00:23:45,640 --> 00:23:48,639 Speaker 1: thirty thousand a year on a concession basis, which is 460 00:23:49,119 --> 00:23:52,560 Speaker 1: not much compared to how much people were putting in. Then, okay, 461 00:23:52,880 --> 00:23:55,320 Speaker 1: I did want to cover that aspect now on a 462 00:23:55,840 --> 00:24:00,320 Speaker 1: different perspective from a different listener, deve love the part. God, 463 00:24:00,400 --> 00:24:04,720 Speaker 1: the last episode was unbalanced. I hoped you would have 464 00:24:04,840 --> 00:24:08,680 Speaker 1: rained in Jeff Wilson on the lack of indexing. Now, 465 00:24:09,280 --> 00:24:13,000 Speaker 1: for what it's worth, that was Jeff Wilson pretty rained in. 466 00:24:13,160 --> 00:24:16,879 Speaker 1: Might I add on the show. But Jeff's point was 467 00:24:17,040 --> 00:24:20,320 Speaker 1: if you don't index, right, So if you say, and 468 00:24:20,400 --> 00:24:22,480 Speaker 1: there's a new text coming in the threshold is X 469 00:24:22,560 --> 00:24:25,959 Speaker 1: number of dollars, and there's no application for inflation index. 470 00:24:26,000 --> 00:24:28,439 Speaker 1: But inflation running at three four percent a year at 471 00:24:28,440 --> 00:24:32,520 Speaker 1: the moment, sometimes higher very quickly. A hell of a 472 00:24:32,520 --> 00:24:35,159 Speaker 1: lot more people that get caught in there than the 473 00:24:35,200 --> 00:24:39,080 Speaker 1: government of the day is saying. Dave says. A recent 474 00:24:39,200 --> 00:24:42,840 Speaker 1: note from Meg Hefron and Meg is a very good 475 00:24:43,280 --> 00:24:46,840 Speaker 1: SMSF specialist, and we've had some people from the Hefron 476 00:24:46,920 --> 00:24:51,280 Speaker 1: group on the show. Hefro Meg Hefron suggested, while the 477 00:24:51,359 --> 00:24:56,360 Speaker 1: legislation previously presented the Parliament didn't include indexation of the threshold, 478 00:24:56,480 --> 00:25:00,320 Speaker 1: many other indexed amounts in tax law are increased every 479 00:25:00,359 --> 00:25:03,880 Speaker 1: now and again. It's unreasonable to assume this slimmit would 480 00:25:03,920 --> 00:25:06,600 Speaker 1: remain at three million in twenty or thirty years time. 481 00:25:06,920 --> 00:25:09,600 Speaker 1: I don't know about that, Dave, I don't know about that. 482 00:25:09,800 --> 00:25:12,600 Speaker 1: I did a bit of research here. Two things, the 483 00:25:12,680 --> 00:25:16,120 Speaker 1: Sophisticated Investor Test. Do you know how long it's been 484 00:25:16,119 --> 00:25:20,720 Speaker 1: since that was indexed? It's over twenty years. More pertinent. 485 00:25:21,280 --> 00:25:25,000 Speaker 1: The closest tax to this tax, but if this one's 486 00:25:25,040 --> 00:25:27,520 Speaker 1: called Division two nine six, the closest one is Division 487 00:25:27,520 --> 00:25:32,760 Speaker 1: two ninety three. That's the tax that your superannuation concessions 488 00:25:32,800 --> 00:25:35,280 Speaker 1: are peelback if you make more than two hundred and 489 00:25:35,320 --> 00:25:38,480 Speaker 1: fifty thousand a year. That was brought in twelve years ago. 490 00:25:38,640 --> 00:25:40,879 Speaker 1: Twelve years ago, two hundred and fifty thousand was what 491 00:25:41,000 --> 00:25:42,479 Speaker 1: a hell of a lot more than it is now. 492 00:25:42,520 --> 00:25:44,720 Speaker 1: If you're on two hundred and fifty thy twelve years ago, 493 00:25:44,720 --> 00:25:46,680 Speaker 1: you're on a big wicket. If you're on two hundred 494 00:25:46,720 --> 00:25:49,480 Speaker 1: and fifty thousand today, it's not as big as it 495 00:25:49,560 --> 00:25:53,040 Speaker 1: used to be at all. However, that threshold holds, so 496 00:25:54,280 --> 00:25:57,919 Speaker 1: it's not really so. I would say it's by no 497 00:25:58,040 --> 00:26:04,280 Speaker 1: means a safe presumption that governments actually do index, particularly 498 00:26:04,359 --> 00:26:09,159 Speaker 1: lucrative taxes. And remember the new super tax is supposed 499 00:26:09,160 --> 00:26:11,080 Speaker 1: to bring in two point three billion a year when 500 00:26:11,119 --> 00:26:12,200 Speaker 1: it's up and running. 501 00:26:12,440 --> 00:26:15,520 Speaker 3: What do you think will I think, I sort of said, 502 00:26:15,560 --> 00:26:18,800 Speaker 3: but I was hoping, which was when the transfer balance 503 00:26:18,840 --> 00:26:22,520 Speaker 3: cap gets to three million, that you have suddenly removed 504 00:26:22,520 --> 00:26:24,639 Speaker 3: a fifteen percent tax and it's now thirty and it 505 00:26:24,720 --> 00:26:28,080 Speaker 3: just gets index from there. I hope that's what if 506 00:26:28,080 --> 00:26:31,400 Speaker 3: it gets through, you resume that's what's common sense. Bash. 507 00:26:32,119 --> 00:26:36,680 Speaker 3: Common sense doesn't always prevail. And one thing that you've 508 00:26:36,760 --> 00:26:40,520 Speaker 3: rightly said is that it was actually under a liberal government. 509 00:26:40,960 --> 00:26:43,800 Speaker 3: They changed the rules and made it. It's actually the 510 00:26:43,840 --> 00:26:46,679 Speaker 3: difficulties getting money into super You can take it out 511 00:26:47,080 --> 00:26:49,160 Speaker 3: once you get to a certain age and you're getting 512 00:26:49,200 --> 00:26:50,639 Speaker 3: it out. Stop issue, it's getting it in. 513 00:26:51,320 --> 00:26:55,000 Speaker 1: And you know what's ridiculous is that, And it's very 514 00:26:55,119 --> 00:26:59,159 Speaker 1: much against younger people accumulating money in Super. The amount 515 00:26:59,200 --> 00:27:01,720 Speaker 1: you can have in Super tax free gets indexed and 516 00:27:01,880 --> 00:27:04,040 Speaker 1: was indexed last year by one hundred grand up to 517 00:27:04,080 --> 00:27:08,240 Speaker 1: two million. The amount you can put in wasn't indexed correct, 518 00:27:08,359 --> 00:27:12,440 Speaker 1: didn't move thirty grand sitting there unchanged, and that's absurd. 519 00:27:12,920 --> 00:27:15,919 Speaker 1: And there's all sorts of explanations for that bus. It 520 00:27:16,040 --> 00:27:20,160 Speaker 1: is completely upside down. Okay, terrific, We are running out 521 00:27:20,160 --> 00:27:22,760 Speaker 1: of time. Thank you very much, Will Hamilton. 522 00:27:22,560 --> 00:27:24,639 Speaker 2: Thank you, James Kirby. Terrific to be on again. 523 00:27:24,960 --> 00:27:26,720 Speaker 1: Great to have you on the show. That was Will 524 00:27:26,720 --> 00:27:29,720 Speaker 1: Hamilton of Hamilton Wealth Partners. Oh and by the way, folks, 525 00:27:29,720 --> 00:27:33,040 Speaker 1: I meant to say my little call out about questions 526 00:27:33,640 --> 00:27:35,920 Speaker 1: seems to have worked straight away and that's really good. 527 00:27:36,320 --> 00:27:39,280 Speaker 1: So remember, if you're sending in a question, feel free 528 00:27:39,359 --> 00:27:42,400 Speaker 1: to send in two or three. Absolutely very welcome. You're 529 00:27:42,440 --> 00:27:44,600 Speaker 1: taking the effort to write in a question, then why 530 00:27:44,640 --> 00:27:46,959 Speaker 1: don't you put in a couple. Just keep them short, 531 00:27:47,240 --> 00:27:51,120 Speaker 1: and I will endeavor endeavor to make sure they are 532 00:27:51,200 --> 00:27:54,240 Speaker 1: all covered. And they are i'd like to think almost 533 00:27:54,240 --> 00:27:57,280 Speaker 1: completely covered all the questions unless they kind of double up, 534 00:27:57,280 --> 00:27:59,560 Speaker 1: and sometimes I put two or three together so let's 535 00:27:59,560 --> 00:28:02,600 Speaker 1: have some more the money puzzle at the Australian dot 536 00:28:02,600 --> 00:28:07,399 Speaker 1: com dot Au. Today's show was produced by Joshua Burton. 537 00:28:07,720 --> 00:28:08,360 Speaker 1: Talk to you soon.