Up to two million Aussies could face super tax: FSC

New modelling from the Financial Services Council (FSC) shows that up to 1.8 million Australians currently in the workforce could be impacted by the proposed superannuation tax under one of the four scenarios.

The four scenarios consist of:

• $3 million threshold without indexation, as previously released (Labor policy)
• $3 million threshold with indexation (potential negotiated outcome)
• $2 million threshold with indexation (Greens policy)
• $2 million threshold without indexation (potential negotiated outcome)

The worst outcome by far will be the $2 million threshold with no indexation scenario, affecting a staggering 1.8 million Australians, more than three times Labor's proposition.

Ultimately, the FSC saidthe decision to index the tax will impose "significant impact" on younger Australians.

FSC chief executive Blake Briggs said it is important for the government to consider the future implications of the tax despite only affecting a fraction of the population in its infancy.

"The government will set the tone for how it intends to govern in its second term by deciding whether to listen to broad consumer, industry and economists' feedback on how the current design of its superannuation tax is unfair to future generations of Australians," Briggs said.

"The superannuation industry recognises the government has the capacity to force the new tax through the Parliament with the support of the Greens but encourages the two parties to take a more constructive and consultative approach."

In response, Briggs is urging the government to consult on measures that could unfairly target the future generation.

"The superannuation industry recognises there is merit to ensuring the superannuation system remains fair and fiscally sustainable, however the government's current approach risks undermining consumer confidence in Australia's retirement system by changing the goal posts on current and future retirees who, until now, have played by the rules," Briggs continued

"The FSC is concerned that the absence of indexation is a deliberate and cynical design feature of the new tax, that targets younger Australians, in full knowledge that Australia's deteriorating financial position means future governments will be too cash strapped to introduce indexation at a later stage."

On Wednesday, Nationals Senator Matt Canavan and Greens leader Larissa Waters debated the viability of the super tax on morning television.

Canavan argued the tax is incredibly unfair and said the Coalition will "fight to the death" to oppose the passing of the bill.