Mary Delahunty, ASFA CEO, said by increasing support for low-income earners and ensuring fair tax contributions from those with substantial superannuation balances, the government could “foster a more balanced and equitable retirement system”.

ASFA is calling for $750 million of the revenue expected to be generated from the proposed new tax be ring-fenced to increase the LISTO threshold for those earning $37,000 to those earning $45,000, alongside boosting the maximum payment from $500 to $700.

It claimed this change would benefit an additional 1.2 million Australians, a majority of whom are women and many of whom are young workers and workers from a non-English speaking background to significantly improve their financial security in retirement.

The research stated that in real terms, this could mean a 35-year-old earning $44,000 could see their superannuation balance at retirement increase from $293,000 to $336,000.

"Division 296 and Division 293 aren’t just measures aimed at removing tax concessions for those with high super balances – it’s an opportunity to make society fairer and provide low-income workers with a more dignified and secure retirement,” Delahunty said.

ASFA has called on Parliament to adopt these recommendations, which will ensure a fairer and more dignified retirement for over 1.2 million low-income workers.

“This is about fairness - enhancing LISTO offers a powerful widespread impact for people’s retirement outcomes.”