Deputy Prime Minister Richard Marles struggles to answer Karl Stefanvoic question

Deputy Prime Minister Richard Marles has been accused of “making it up on the run” after struggling to answer a question about retirement.

Those with more than $3 million in retirement will no longer receive tax breaks under a new plan announced this week by Anthony Albanese.

The Prime Minister and Federal Treasurer Jim Chalmers confirmed plans to double the tax rate on contributions to 30 per cent, down from 15 per cent, for 80,000 Australians, with the changes expected to take effect on 1 July 2025.

“We have to make the system sustainable,” Marles said on the Today Show.

“We inherited a budget from Peter (Dutton) and his crew, with billions of dollars in debt, and there’s nothing to prove.”

Karl Stefanovic asked Mr Marles to clarify a detail of Labour’s new plan – at one point telling the deputy prime minister it was ‘okay’ if he didn’t know the answer.

“I know it’s a technical question, but how are you going to tax the increased paper value of an asset that hasn’t been sold?” Stefanovic.

Ms Marles tried to redirect the question to the small number of Aussies that would be affected – prompting Stefanovic to interrupt with, ‘If you don’t know, it’s okay’.

“I’ll let you try to come up with a better explanation for that at a later date, as Jim Chalmers did recently,” Stefanovic said.

Mr Marles stressed it was a “modest” change that would only affect those with a $3 million pension, just 0.5 per cent of Australians.

“They make it up on the run,” opposition leader Peter Dutton told the show.

“They want to tax unrealized capital gains. When your shares go to paper value, they want to tax you on the profits before you actually sell the shares, which is unbelievable.”

The clash comes after federal treasurer Jim Chalmers confirmed plans to double the contribution tax rate to 30 percent, down from 15 percent, for 80,000 Australians, with the changes expected to take effect on July 1, 2025.

This would affect some 80,000 people, the top 0.5 percent of super savers, and save the federal budget about $2 billion a year.

The deputy prime minister told the Today Show on Friday: ‘We inherited a budget from Peter (Dutton) (right) and his team, which was a trillion dollars in debt and there’s nothing to show for it’

The other 99.5 per cent of Australians would continue to receive the same tax benefits, meaning the 15 per cent preferential rate would remain unchanged for them.

The change will only take effect after the next elections, which are scheduled for mid-2025.

Earlier this week, the prime minister argued that the plan does not change the fundamentals of the pension system and is a “significant reform”.

He pointed to figures showing that 17 Australians have more than $100 million in their retirement savings accounts, and one person has more than $400 million in super money.

Australians with super balances of more than $3 million will no longer receive generous tax breaks under a new scheme announced by Prime Minister Anthony Albanese (pictured right with Treasurer Jim Chalmers)

The chart showed a total of 411,128 pension funds with balances in excess of $1 million. A pension fund amassed an astounding $544 million (pictured)

“It’s hard to argue that those levels relate to actual retirement income, which is what retirement is for,” Albanese told reporters.

Most Australians agree that this is not what retirement is for.

“It’s for people’s retirement income.”

Two-thirds of retirement tax breaks go to the top 20 percent of income earners, and less than 1 percent of people have super savings of more than $3 million, with that group having an average pool of $5.8 million.

The favorable 15 percent tax rate on super-contributions costs the budget $53 billion a year, with the crackdown on those with more than $3 million in super-contributions estimated to save the Treasury $2 billion.