A federal MP representing one of Australia’s richest electorates has admitted the government’s plan to tax unrealised gains on super is ‘complicated’.

Jerome Laxale made history earlier this month as the first ever Labor representative to be re-elected in the seat of Bennelong, which covers Sydney’s lower north shore. 

He now has a safe seat, even with new boundaries east of the Lane Cove River, where Labor never previously had a federal MP.

His redrawn electorate now also includes Hunters Hill and Woolwich – double waterfront suburbs in the 2110 postcode, where the average taxable income of $215,456 is almost triple the national average of $72,327.

These harbourside suburbs make up Australia’s ninth richest postcode, making it much more likely to have residents with large superannuation balances in the millions.

Laxale admitted Labor’s plan for a new 15 per cent tax on the notional value of superannuation assets above a $3million threshold was complex.

‘Yes, it is complicated but it is the simplest of the other alternatives,’ he told Daily Mail Australia.

‘The Treasury was tasked with finding a way to do it in a way that was simple and cost effective and this was the advice that they gave the Treasurer.’

Jerome Laxale has admitted the government's plan to tax unrealised gains on super is 'complicated'. He's pictured with PM Anthony Albanese during the election campaign

 Jerome Laxale has admitted the government’s plan to tax unrealised gains on super is ‘complicated’. He’s pictured with PM Anthony Albanese during the election campaign

Under the Labor’s tax division 296 plan, those with a self-managed super fund would be forced to sell assets like real estate or land to keep their retirement savings under $3million and avoid having to pay the hated tax on unrealised gains.

Labor also plans to double earnings taxes to 30 per cent for retirement savings above this threshold. 

Like Treasurer Jim Chalmers, Laxale has defended the government’s plan to avoid indexing it for inflation, despite AMP modelling showing it will affect the average 22-year-old worker now in four decades time.

‘I point to the tax tables which also aren’t indexed and they move as well,’ he said.

‘A future government will move this if it’s unindexed and that’s a pretty regular occurrence in tax law in Australia.’

Despite the Opposition opposing Labor’s plan, Laxale claimed very few voters raised the issue while campaigning, in a seat with new boundaries that were notionally Liberal heading into the May 3 election. 

‘It didn’t come up much when it passed through the House of Representatives a couple of years ago – it’s only come up a handful of times during the election,’ he said.

‘I think people see this as a modest change and one that will impact only half a per cent of Australians and people with over $3million in super.

Labor won almost every polling booth in Bennelong except Hunters Hill (pictured) which is Australia's ninth richest postcode with an average taxable income of $215,456

Labor won almost every polling booth in Bennelong except Hunters Hill (pictured) which is Australia’s ninth richest postcode with an average taxable income of $215,456

‘The facts are that the overwhelming majority of people in Bennelong have super balances under $3million and will not be affected, which is why it wasn’t really raised that much with me.’ 

In the 2110 postcode, covering Hunters Hill, the average super balance is $600,829, or more than triple Australia’s average super balance of $164,126, tax office data shows.

But this still well below the $1.027m average at Palm Beach, on Sydney’s northern beaches, where the average taxable income is $216,262 in a Teal electorate.

Labor estimates its plan will only affect 0.5 per cent of Australian or 80,000 people with no plans to index it for inflation.

Australians had $4.2billion in superannuation at the end of last year but a quarter of that, or $1.1billion was in a self-managed super fund rather in than the usual industry or retail fund.

Labor’s is going ahead with its plan to tax those with high superannuation balances, even though it now represents more ultra-wealthy voters than the Liberal Party.  

Hunters Hill wasn’t the only top 10 postcode for wealth in a Labor electorate with the ALP also representing Hawksburn in the former Green leader Adam Bandt’s old seat of Melbourne, where the average super balance is $956,724 and $266,020 is the average, taxable income.

The 3142 postcode is Australia’s fourth richest, and also covers neighbouring Toorak, now in Teal MP Monique Ryan’s redrawn Kooyong electorate.

Like Treasurer Jim Chalmers, Laxale has defended the government's plan to avoid indexing it for inflation, despite AMP modelling showing it will affect an average, 22-year-old worker now in four decades' time

Like Treasurer Jim Chalmers, Laxale has defended the government’s plan to avoid indexing it for inflation, despite AMP modelling showing it will affect an average, 22-year-old worker now in four decades’ time

Teal MPs represent eight of Australia’s 10 richest postcodes, and they have expressed concerns about taxing unrealised gains. 

Allegra Spender’s Wentworth electorate in Sydney’s east is home to five of Australia’s richest postcodes, with the Liberal Party representing just one ultra-wealthy suburb, Portsea, in the seat of Flinders on the Mornington Peninsula south-east of Melbourne.

Labor won 59.27 per cent of the two-party vote in Bennelong and overwhelmingly carried a landslide majority of the 63 booths in the electorate, including in the upmarket waterfront suburbs of Gladesville and Greenwich.

‘It is historic being only the first Labor MP to hold on to Bennelong and to win those new areas,’ Laxale said.

‘It’s something I won’t take for granted – some people came up to me on election day saying this is the first time in their life they voted Labor and that’s a huge responsibility for me.

‘An overwhelming majority of Australians want people to govern from the centre and that was reflected in the vote.

‘Our government offered policies and plans that resonated well with people in Bennelong regardless of their income.’ 

The exceptions were one booth in Hunters Hill, where Liberal Party candidate Scott Yung had 56.78 per cent of the vote after preferences.

The Liberal Party also carried three hospital booths, getting 61.49 per cent of the vote in one of them, suggesting highly-paid surgeons were less likely to vote Labor and may have had misgivings about the plan to increase taxes on large superannuation balances. 

Laxale claimed older voters, who are more likely to have big super balances, voted Labor because of its $16billion plan to cut student debt by 20 per cent or an average of $5,520 from their Higher Education Contribution Scheme liabilities.

‘You’ve got a lot of older people who came to me on election day and said, ‘What tipped me over the line was the 20 per cent reduction in HECS because I want my kids not to be burdened with this debt and to be able to get a start in life either for a place to rent or a place to live’,’ he said.

Bennelong’s longest-serving member, former Liberal prime minister John Howard, introduced new laws in 2006 enabling those over 60 to withdraw their super tax free during the retirement phase.

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