Australian Treasurer introduces ‘Div 296’ to Parliament
The Australian Government has officially introduced the Division 296 bill five months after the Treasurer conceded defeat on taxing unrealised gains.
Treasurer Jim Chalmers introduced the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 to the House of Representatives on Wednesday morning, including the $3 million super tax portion as well as changes to the LISTO.
Explaining the Division 296 portion of the bill, Chalmers said it “reduces tax concessions available to individuals with total superannuation balances above $3 million”.
“It will mean the concessional tax rate applying on future earnings on balances between $3 million and $10 million will be a combined headline rate of 30 per cent.”
“Earnings corresponding to balances below $3 million will continue to be taxed at 15 per cent in the accumulation phase and earnings will remain tax free in the retirement phase. The concessional rate applying on future earnings on balances above $10 million will be 40 per cent.”
The Treasurer also acknowledged the super industry and the wider Australian community for their “engagement and feedback” on the legislation.
The introduction of the bill follows the government’s October 2025 backflip on taxing unrealised gains after the plan received heavy criticism.
Under the version of the tax that the Treasurer had proposed more than two years ago, all earnings above $3 million would be taxed at 30 per cent, rather than the 15 per cent under current rules. This would also apply to unrealised gains and was not subject to indexation.
The new version would see the additional tax payable only on the realised investment earnings generated by the portion of an individual’s total superannuation balance that exceeds $3 million, as well as a higher tax rate totalling 40 per cent on earnings from the TSB portion exceeding $10 million.
Alongside these changes, the start date was also pushed back from 1 July 2025 to 1 July 2026.
Source: SMSF Adviser (2026) Treasurer introduces Div 296 to Parliament, 11 February. https://www.smsfadviser.com/treasurer-introduces-div-296-to-parliament/