{"id":"C2004A05170","name":"Superannuation Contributions Tax Imposition Act 1997","slug":"superannuation-contributions-tax-imposition-act-1997","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"72 of 1997","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":55467,"registerId":"commonwealth-C2004A05170-1775103704153","compilationNumber":null,"startDate":"2026-04-02","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Short title [see Note 1]","content":"#### 1 Short title \\[see Note 1\\]\n\n  This Act may be cited as the Superannuation Contributions Tax Imposition Act 1997.","sortOrder":0},{"sectionNumber":"2","sectionType":"section","heading":"Commencement [see Note 1]","content":"#### 2 Commencement \\[see Note 1\\]\n\n  This Act commences on the day on which it receives the Royal Assent.","sortOrder":1},{"sectionNumber":"3","sectionType":"section","heading":"Interpretation","content":"#### 3 Interpretation\n\n  Expressions used in this Act that are defined by the Superannuation Contributions Tax (Assessment and Collection) Act 1997 have the same meanings as in that Act.","sortOrder":2},{"sectionNumber":"4","sectionType":"section","heading":"Imposition of superannuation contributions surcharge","content":"#### 4 Imposition of superannuation contributions surcharge\n\n  The superannuation contributions surcharge that is payable on a member’s surchargeable contributions for a financial year under the Superannuation Contributions Tax (Assessment and Collection) Act 1997 is imposed by this Act.\n\n> Note: Surcharge is not payable for the financial year that began on 1 July 2005 or a later financial year—see subsection 7(1) of the Superannuation Contributions Tax (Assessment and Collection) Act 1997.","sortOrder":3},{"sectionNumber":"5","sectionType":"section","heading":"Rate of superannuation contributions surcharge","content":"#### 5 Rate of superannuation contributions surcharge\n\n  (1AA) In this section:\n\n> higher income amount means:\n\n    (a) for the 2003‑2004 financial year—$114,981; and\n    (b) for the 2004‑2005 financial year—that amount as indexed under section 7.\n\n> lower income amount means:\n\n    (a) for the 2003‑2004 financial year—$94,691; and\n    (b) for the 2004‑2005 financial year—that amount as indexed under section 7.\n\n> maximum surcharge percentage means:\n\n    (a) for the 2003‑2004 financial year—14.5%; and\n    (b) for the 2004‑2005 financial year—12.5%.\n  (1) Unless subsection (3) applies, if the member’s adjusted taxable income for a financial year (relevant adjusted taxable income) is not less than the lower income amount but is less than the higher income amount, the rate of the superannuation contributions surcharge that applies to the member for that year is the percentage (calculated to 5 decimal places) of the member’s surchargeable contributions for that year worked out using the formula:\n\n![](image.002.png)\n\n  where:\n\n> A is:\n\n![](image.003.png)\n\n  (1A) If the percentage calculated under subsection (1) for a financial year would, if it were worked out to 6 decimal places, end with a number greater than 4, the number so calculated is increased by 0.00001.\n  (2) If the member’s adjusted taxable income for a financial year is equal to, or greater than, the higher income amount, the rate of the superannuation contributions surcharge that applies to the member for that year is the maximum surcharge percentage of the member’s surchargeable contributions for that year.\n  (3) If:\n    (a) the member has not quoted his or her tax file number in connection with the operation or the possible future operation of the Superannuation Contributions Tax (Collection and Assessment) Act 1997 to the superannuation provider, or one of the superannuation providers, who, at the end of a financial year, held any of the member’s surchargeable contributions for that year; and\n    (b) the Commissioner has not, after taking all reasonable steps, found out the member’s tax file number; and\n    (c) the Commissioner has written a letter to the member at the member’s last‑known address telling the member that, if the member does not quote his or her tax file number, the rate of surcharge that will apply to the member for a financial year (the relevant financial year) may be the maximum surcharge percentage of the member’s surchargeable contributions for the relevant financial year;\n  the following provisions have effect:\n    (d) if contributed amounts in respect of contributions began to be paid for or by the member to a superannuation provider before 7 May 1997 and the member’s surchargeable contributions for the relevant financial year exceed the surchargeable contributions threshold—the rate of surcharge that applies in respect of the member’s surchargeable contributions for the relevant financial year is the maximum surcharge percentage of those contributions;\n    (e) if contributed amounts in respect of contributions began to be paid for or by the member to a superannuation provider before 7 May 1997 and the member’s surchargeable contributions for the relevant financial year do not exceed the surchargeable contributions threshold—the rate of surcharge that applies in respect of the member’s surchargeable contributions for the relevant financial year is nil;\n    (f) subject to subsection (4), if no contributed amounts in respect of contributions began to be paid for or by the member to a superannuation provider before 7 May 1997—the rate of surcharge that applies in respect of the member’s surchargeable contributions for the relevant financial year is the maximum surcharge percentage of those contributions.\n  (4) If:\n    (a) the Commissioner has written a letter to a member as mentioned in paragraph (3)(c); and\n    (b) the member has not quoted his or her tax file number as mentioned in paragraph (3)(a) within 3 months after the letter was sent;\n  paragraph (3)(f) does not apply in respect of the member unless the Commissioner has, after that period, written a further letter to the member:\n    (c) to an address determined by the Commissioner as most appropriate for the letter to reach the member; and\n    (d) in the same terms as the earlier letter.","sortOrder":4},{"sectionNumber":"6","sectionType":"section","heading":"Surchargeable contributions threshold","content":"#### 6 Surchargeable contributions threshold\n\n  Surchargeable contributions threshold for the 1996‑97 financial year\n  (1) The surchargeable contributions threshold for the 1996‑97 financial year is $2,000.\n  Surchargeable contributions for a later financial year\n  (2) The surchargeable contributions threshold for a financial year (the relevant financial year) after the 1996‑97 financial year is the amount worked out using the formula:\n  ![](image.004.png)\n  where:\n\n> previous threshold means the surchargeable contributions threshold for the financial year immediately before the relevant financial year.\n\n> indexation factor means the number worked out under subsections 9(4) and (5) of the Superannuation Contributions Tax (Assessment and Collection) Act 1997 for the relevant financial year.\n\n> current charge percentage means the number that is specified in subsection 19(2) of the Superannuation Guarantee (Administration) Act 1992 for the quarter beginning on 1 July of the relevant financial year.\n\n> previous charge percentage means the number that is specified in subsection 19(2) of the Superannuation Guarantee (Administration) Act 1992 for the quarter beginning on 1 July of the financial year immediately before the relevant financial year.","sortOrder":5},{"sectionNumber":"7","sectionType":"section","heading":"Indexation","content":"#### 7 Indexation\n\n  Indexation of certain amounts for 2004‑05 financial year\n  (1) Section 5 applies in relation to an indexing financial year as if each indexable amount were replaced by the amount worked out using the formula:\n\n![](image.005.png)\n\n  where:\n\n> previous indexable amount means the indexable amount for the financial year immediately before the indexing financial year.\n\n> relevant indexation factor means the indexation factor for the indexing financial year.\n\n  Rounding off of indexed amounts\n  (2) If an amount worked out under subsection (1) is an amount of dollars and cents:\n    (a) if the number of cents is less than 50—the amount is to be rounded down to the nearest whole dollar; or\n    (b) otherwise—the amount is to be rounded up to the nearest whole dollar.\n  Indexation factor\n  (3) The indexation factor for an indexing financial year is the number calculated, to 3 decimal places, using the formula:\n\n![](image.006.png)\n\n  where:\n\n> current March year means the period of 12 months ending on 31 March immediately before the indexing financial year.\n\n> previous March year means the period of 12 months immediately before the current March year.\n\n  Rounding up of indexation factor\n  (4) If the number calculated under subsection (3) for a financial year would, if it were worked out to 4 decimal places, end with a number greater than 4, the number so calculated is increased by 0.001.\n  Change in index numbers\n  (5) If, at any time, whether before or after the commencement of this Act, the Australian Statistician has published or publishes an index number for a quarter in substitution for an index number previously published for the quarter, the publication of the later index number is to be disregarded.\n  Indexable amounts to be published\n  (6) The Commissioner must publish before, or as soon as practicable after, the start of the 2004‑05 financial year the indexable amounts as replaced under subsection (1) for that year.\n  Definitions\n  (7) In this section:\n\n> indexable amount means:\n\n    (a) an amount stated in section 5; or\n    (b) if that amount has previously been altered under this section—the altered amount.\n\n> indexing financial year means the 2004‑05 financial year.\n\n> index number, for a quarter, means the estimate of full‑time adult average weekly ordinary time earnings for the middle month of the quarter published by the Australian Statistician.\n\n> Note: For the purposes of this section, Australian Statistician means the Australian Statistician referred to in subsection 5(2) of the Australian Bureau of Statistics Act 1975.","sortOrder":6},{"sectionNumber":"8","sectionType":"section","heading":"Severability","content":"#### 8 Severability\n\n  If, apart from this section, section 4 would impose in relation to a State, or an authority or officer of a State, a superannuation contributions surcharge the imposition of which in relation to the State, authority or officer would exceed the legislative power of the Commonwealth, section 4 has effect as if it did not impose that surcharge in relation to the State, authority or officer, as the case may be.","sortOrder":7},{"sectionNumber":"9","sectionType":"section","heading":"Act does not impose tax on property of State","content":"#### 9 Act does not impose tax on property of State\n\n  (1) Without limiting section 7, this Act does not impose a tax on property of any kind belonging to a State.\n  (2) In this section:\n\n> property of any kind belonging to a State has the same meaning as in section 114 of the Constitution.","sortOrder":8}],"analysis":{"issue_detection":{"absurdities":[{"type":"other","section":"4 (with Note) and 5","severity":"medium","reasoning":"Section 4 remains on the books as an active imposition provision, but between the sunset confirmed by the note (no surcharge payable from 1 July 2005) and section 5 only specifying rates up to 2004-2005, the Act has been a legal shell for nearly two decades. The imposition mechanism is live but permanently inert, which is a structural absurdity even if legally harmless.","confidence":0.82,"description":"Section 4 imposes a surcharge and section 5 sets its rate, but the embedded note to section 4 confirms the surcharge is not payable for any financial year from 1 July 2005 onwards, while section 5 only defines rates for the 2003-2004 and 2004-2005 financial years. The Act therefore imposes a tax that has no operative rate for the years it actually applies beyond 2004-2005, and imposes nothing at all from 2005-2006 onwards, making the ongoing existence of the imposition provision functionally vacuous."},{"type":"impossible_compliance","section":"5(3)(c) and 5(4)","severity":"medium","reasoning":"The Act provides no guidance on how the Commissioner determines the 'most appropriate' address. If it differs from the last-known address used in the first letter, the Commissioner needs information not described anywhere in the Act. If it is the same address, the further letter requirement is redundant ceremony. Either way, the provision is either unworkable or meaningless.","confidence":0.75,"description":"The penalty TFN regime in subsection 5(3) is triggered by the Commissioner writing a letter to the member's 'last-known address', but subsection 5(4) then requires a *further* letter to 'an address determined by the Commissioner as most appropriate'. If the Commissioner already knows the last-known address, the further-letter address standard adds nothing. If the Commissioner does not know a better address, the further-letter requirement is an impossible compliance obligation, since the Commissioner must positively determine a 'most appropriate' address without any mechanism or criteria provided for doing so."},{"type":"other","section":"9(1)","severity":"medium","reasoning":"The phrase 'Without limiting section 7' in section 9(1) is almost certainly a drafting error for 'Without limiting section 8'. Section 7 is an indexation provision with no connection to State property or constitutional limits. Section 8 is the severability clause carving out State-related surcharges. A cross-reference to section 7 as the outer bound of section 9 is incoherent and the provision cannot be read literally without absurdity.","confidence":0.88,"description":"Section 9(1) purports to qualify section 9 by reference to 'section 7', but section 7 deals exclusively with indexation of dollar amounts. The cross-reference to section 7 as the provision being 'limited' by section 9 makes no logical sense; the intended cross-reference is almost certainly to section 8 (severability), which is the provision that deals with State-related carve-outs."},{"type":"self_contradicting","section":"5(1) and 5(1A)","severity":"low","reasoning":"Subsection 5(1) mandates 5 decimal places as the operative precision. Subsection 5(1A) requires examining the 6th decimal place to determine whether to increment the 5th. While this is a common rounding technique, the Act's drafting creates a minor internal tension: the 6th decimal place is instructed to be disregarded by 5(1) yet must be computed for 5(1A). In practice this works, but it is logically inconsistent as written.","confidence":0.55,"description":"The rate formula in subsection 5(1) instructs that the percentage be calculated to exactly 5 decimal places, while subsection 5(1A) then applies a rounding rule based on what the figure *would* be at 6 decimal places. The Act thus requires a calculation to be simultaneously expressed at 5 decimal places and evaluated at 6 decimal places, with no instruction as to which figure governs the ultimate rate before rounding. The rounding rule operates on a hypothetical precision that the Act elsewhere prohibits from being expressed."},{"type":"other","section":"7(5)","severity":"low","reasoning":"This is a common legislative certainty device (locking in the index number as at time of calculation), but it produces the absurd result that a corrected, more accurate official figure must be ignored in favour of a figure the Statistician itself has repudiated. The practical and logical effect is that tax liability is intentionally calculated on wrong data once a correction is published.","confidence":0.78,"description":"Section 7(5) directs that if the Australian Statistician publishes a substitute index number for a quarter, the later (corrected) number is to be disregarded and the earlier (potentially erroneous) number used. This means the Act mandates the use of known incorrect data if the Statistician issues a correction, which is a deliberate but logically absurd outcome—the Act prefers official error over official correction."}],"contradictions":[{"severity":"medium","section_a":"4 (and Note)","section_b":"5(1AA)(b) — 2004-2005 financial year rate provisions","confidence":0.8,"description":"Section 4's embedded note confirms the surcharge is not payable for the financial year beginning 1 July 2005 or any later year. Section 5(1AA) defines rates only for 2003-2004 and 2004-2005. Yet section 4 continues to impose the surcharge in general terms with no sunset clause in the operative provision itself, creating a contradiction between the imposition section (which reads as ongoing) and the combined effect of the note and section 5 (which cap operation at 2004-2005)."},{"severity":"high","section_a":"5(3)(d) and 5(3)(e)","section_b":"5(3)(f)","confidence":0.85,"description":"Paragraphs 5(3)(d) and (e) apply where contributed amounts began to be paid before 7 May 1997, with liability turning on whether contributions exceed the surchargeable contributions threshold. Paragraph 5(3)(f) applies where no contributed amounts began to be paid before 7 May 1997, imposing the maximum surcharge percentage unconditionally (subject to s.4). This creates a structural contradiction: members with pre-7 May 1997 contributions below the threshold pay nil surcharge (paragraph (e)), while members with no pre-7 May 1997 contributions at all face the maximum surcharge regardless of contribution level. The class with less historical participation is penalised more heavily than the class with some historical participation, with no articulated policy rationale bridging this gap."},{"severity":"medium","section_a":"8","section_b":"9(1)","confidence":0.83,"description":"Section 8 (severability) carves out State-related surcharges that would exceed Commonwealth legislative power. Section 9(1) purports to operate 'without limiting section 7' (indexation), which is an incoherent cross-reference that contradicts the clear structural relationship between sections 8 and 9. If read literally, section 9 operates independently of the severability framework in section 8 rather than complementing it, potentially leaving a gap between the two protective provisions for States."},{"severity":"low","section_a":"6(2) — surchargeable contributions threshold formula","section_b":"4 (Note) — surcharge not payable from 1 July 2005","confidence":0.72,"description":"Section 6(2) establishes a continuing indexed formula for calculating the surchargeable contributions threshold for each financial year after 1996-97, with no termination date. The note to section 4 confirms surcharge is not payable from 1 July 2005. The threshold formula therefore continues to operate mechanically in perpetuity, indexing a threshold for a surcharge that cannot apply, creating a permanently futile computational obligation."}]},"kimi_summary":{"_metrics":{"source":"grok-batch-everything"},"content_quality":"ok","complexity_score":7,"scope_assessment":{"changed":true,"description":"The legislation has been expanded from its 1997 original purpose of simply imposing the surcharge; later amendments embedded detailed year-specific thresholds and rates for 2003–2005, complex indexation machinery, TFN quotation safeguards, and an explicit note abolishing application from the 2005–06 year onward, thereby both broadening the mechanical detail while narrowing the substantive ongoing reach."},"complexity_factors":["Intricate mathematical formulas in s.5(1) and s.7 for rate calculation, indexation factors and rounding to 5 or 6 decimal places","Tiered income thresholds with year-specific dollar values (lower income amount, higher income amount) that are indexed under s.7","Multi-paragraph conditional logic in s.5(3) and s.5(4) creating different outcomes based on tax file number quotation, contribution start dates before 7 May 1997, and follow-up letters from the Commissioner","Heavy cross-referencing to the Superannuation Contributions Tax (Assessment and Collection) Act 1997 for all definitions and to the Superannuation Guarantee (Administration) Act 1992 for charge percentages in s.6","Separate indexation and rounding rules in s.6(2) and s.7(1)–(4) that interact with Australian Statistician data and prior-year thresholds"],"plain_english_summary":"**This law imposes an extra tax (called the superannuation contributions surcharge) on retirement savings contributions for higher-income people.**\n\nThe Act creates the legal authority to charge this surcharge on 'surchargeable contributions' (extra super payments above a set threshold) when a person's adjusted taxable income exceeds specified limits. It sets out exactly how the tax rate is calculated: if income sits between a lower threshold (around $94,691 in 2003-04) and a higher one (around $114,981), the rate is worked out using a sliding formula that tops out at 14.5% or 12.5% depending on the year. Above the higher threshold the maximum rate applies automatically. \n\nSpecial rules kick in if someone has not given their tax file number to their super fund – in many cases this forces the highest rate to apply. The law also explains how to update the contribution threshold each year using inflation and super guarantee rates, and how to index income brackets. \n\nIt only applies up to the 2004-05 financial year (a note confirms no surcharge is payable from 1 July 2005 onwards). Separate clauses protect constitutional limits by preventing the tax from applying to State governments or their property. \n\nIn plain terms, the legislation was designed to reduce generous tax breaks on super for wealthy Australians, making the retirement savings system fairer. It works hand-in-hand with a companion law that actually calculates and collects the tax."},"summary":{"complexity_score":7,"scope_assessment":{"changed":true,"description":"The Act originally imposed the superannuation contributions surcharge with no stated end date, implying an ongoing measure. However, a note added to section 4 records that the surcharge was abolished for financial years from 1 July 2005 onwards (per the companion Assessment and Collection Act). The original scope was a permanent higher-income super tax measure; it became a time-limited historical provision. Additionally, the rate was reduced (from 14.5% to 12.5%) in the final year of operation, indicating a narrowing of fiscal impact even before abolition."},"complexity_factors":["Multiple interlinked formula-based calculations for the surcharge rate, requiring reference to defined variables and subsections","Heavy cross-referencing to a companion Act (Superannuation Contributions Tax (Assessment and Collection) Act 1997) for definitions and key mechanisms","Multi-step indexation process involving ABS statistics, rounding rules, and annual recalculation","Conditional rate provisions for members without Tax File Numbers, including cascading conditions and timing rules","Distinction between pre- and post-7 May 1997 contribution start dates affecting which rate applies","Constitutional severability clause requiring knowledge of Commonwealth legislative power limits regarding States","Now-obsolete provisions that still have potential legal relevance for historical assessments, creating interpretive complexity"],"plain_english_summary":"## Superannuation Contributions Tax Imposition Act 1997\n\n### What does this law do?\nThis Act formally **imposes a tax surcharge** (an extra tax charge) on certain superannuation (retirement savings) contributions made by higher-income earners. It doesn't collect the tax itself — that's handled by a companion law — but it provides the legal authority to charge it and sets the **rate** of the surcharge.\n\n### Who does it affect?\nThis law targets **higher-income superannuation fund members** — specifically those whose adjusted taxable income (their total income after certain adjustments) falls above set thresholds:\n- **Lower income threshold** (2003–04): ~$94,691\n- **Upper income threshold** (2003–04): ~$114,981\n\nIf your income was **between** those two amounts, a sliding-scale surcharge applied. If your income was **at or above** the upper amount, the **maximum surcharge** applied (14.5% in 2003–04, 12.5% in 2004–05).\n\n### Key points to know:\n- ⚠️ **This surcharge no longer applies** from 1 July 2005 onwards. It was abolished, so it only ever affected contributions made in financial years up to and including 2004–05.\n- 🔢 The surcharge rate was calculated using a formula that scaled up with your income between the two thresholds.\n- 🪪 **No Tax File Number (TFN)?** If you didn't provide your TFN to your super fund and the ATO couldn't find it, the maximum surcharge rate automatically applied — the ATO had to warn you by letter first.\n- 📈 The income thresholds and a base contributions amount ($2,000 starting in 1996–97) were **indexed each year** using average weekly earnings data from the Australian Bureau of Statistics.\n- 🏛️ Constitutional protections are built in: the Act cannot impose this tax on **State government property**, consistent with section 114 of the Australian Constitution.\n\n### Why does it matter now?\nWhile the surcharge no longer applies going forward, **outstanding debts or assessments** from those earlier years may still be relevant for some people. Understanding this Act can matter if you're dealing with old super fund records, tax debts, or compliance issues from the late 1990s to mid-2000s."},"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":true,"description":"The Act’s operative scope is confined to a defined historical period and specific indexed amounts. It sets explicit numeric bands and rates for the 2003–04 and 2004–05 financial years (s5(1AA)–(2)) and supplies indexation mechanics for 2004–05 (s7). The note accompanying section 4 in the text states that surcharge is not payable for the financial year that began 1 July 2005 or later (see the note to s4), which reduces the Act’s operational timeframe compared with a permanently ongoing surcharge. The Act’s practical reach is also narrowed by reliance on definitions and collection machinery in the Superannuation Contributions Tax (Assessment and Collection) Act 1997 (s3–s4), by TFN default rules that create exceptions tied to contributions begun before 7 May 1997 (s5(3)(d)–(e)), and by constitutional limits in sections 8–9 that exclude certain State property or State officers from the imposition where Commonwealth power is exceeded."},"complexity_factors":["Numeric sliding‑scale formula in s5(1) requiring calculation to 5 (and 6) decimal places and an adjunct rounding rule in s5(1A).","Multiple cross‑references to external legislation for definitions and inputs (Superannuation Contributions Tax (Assessment and Collection) Act 1997 for meanings (s3); Superannuation Guarantee (Administration) Act 1992 for charge percentages used in threshold indexation (s6(2))).","Time‑limited and year‑specific provisions: explicit numeric amounts and percentages for 2003–04 and 2004–05 (s5(1AA)), and special indexation rules for 2004–05 (s7).","TFN default regime with conditional exceptions depending on contribution start date (pre‑7 May 1997), Commissioner steps, and statutory notice periods (s5(3)–(4)).","Indexation mechanics that depend on ABS wage index numbers, an indexation factor formula with rounding rules, and a publication obligation (s7(1)–(6)).","Constitutional/legislative boundary rules: severability if Commonwealth power is exceeded and an express non‑taxation of State property (s8–9), adding a layer of legal‑interpretive complexity."],"plain_english_summary":"What this law does, in practical terms\n\n- Mechanically, the Act imposes a superannuation contributions surcharge on a member’s surchargeable contributions for a financial year. The surcharge imposed by this Act is the same surcharge that is payable under the Superannuation Contributions Tax (Assessment and Collection) Act 1997 (s4). Definitions used by this Act come from that Assessment and Collection Act (s3).\n\n- The Act sets how the surcharge rate is worked out for the 2003–04 and 2004–05 financial years. It defines two income bands (a lower income amount and a higher income amount) and a maximum surcharge percentage (s5(1AA)–(2)). If a member’s adjusted taxable income is between the lower and higher amounts, the surcharge rate is calculated by a sliding‑scale formula (s5(1)). If income is at or above the higher amount, the maximum surcharge percentage applies (s5(2)). The Act includes numeric precision rules for the calculation (s5(1A)).\n\n- The Act contains a specific compliance mechanism tied to tax file numbers (TFNs). If a member has not quoted their TFN to the superannuation provider, the Commissioner has taken “all reasonable steps” to find it, and the Commissioner has written to the member warning them of possible application of the maximum surcharge, special rules apply. Those rules can lead to the maximum surcharge applying in most cases where TFN is not provided, with narrow exceptions for members whose contributions began before 7 May 1997 and whose surchargeable contributions do not exceed the surchargeable contributions threshold (s5(3)–(4)). The Commissioner also has a specified follow‑up step if the member does not respond within 3 months (s5(4)).\n\n- The Act fixes the initial surchargeable contributions threshold at $2,000 for 1996–97 and provides a formula to index that threshold for later years (s6(1)–(2)). The threshold formula uses an indexation factor and compares current and previous superannuation guarantee charge percentages (s6(2)).\n\n- For the 2004–05 financial year the Act specifies indexation rules for amounts stated in section 5 (s7(1)–(3)). Indexation uses Australian Bureau of Statistics wage index numbers (average weekly ordinary time earnings) and includes detailed rounding rules and a publication obligation on the Commissioner to publish the indexed amounts before, or as soon as practicable after, the start of the 2004–05 year (s7(3)–(6)).\n\n- The Act limits its application to the extent constitutional or legislative limits arise. It treats any part of section 4 that would exceed Commonwealth legislative power in relation to a State (or a State authority or officer) as if it did not impose surcharge in relation to that State, authority or officer (s8). The Act also expressly says it does not impose a tax on property of a State (s9(1)), using the constitutional meaning of that term (s9(2)).\n\nOfficial purpose claims and a practical review of costs, incentives and trade‑offs\n\n- The Act’s mechanism is (explicitly) to impose the superannuation contributions surcharge payable under the Assessment and Collection Act (s4). That is a straightforward imposition of a percentage charge on defined surchargeable contributions according to income bands and an explicit maximum percentage (s5). The Act therefore operationalises a tax on certain superannuation contributions for the listed years.\n\n- Who pays: the surcharge is payable in respect of a member’s surchargeable contributions; therefore the direct economic burden falls on members who have surchargeable contributions in the relevant financial year and whose adjusted taxable income places them in the relevant bands (s4, s5). Indirectly, the burden reduces the net amount credited to a member’s superannuation account because the surcharge is applied to contributions (s4, s5).\n\n- Who decides / administrative roles: superannuation providers hold the contributions for members and are the points of contact for TFN quoting (s5(3)(a)). The Commissioner has the operational role of locating TFNs, sending warning letters, applying the TFN default rules, and publishing indexed amounts for 2004–05 (s5(3)–(4); s7(6)). The Commissioner has limited discretionary tasks: assessing whether “all reasonable steps” to find a TFN have been taken, and selecting the address “most appropriate” for a follow‑up letter (s5(3)(b), s5(4)(c)).\n\n- Compliance burdens and behavioural incentives: members must quote their TFN to relevant superannuation providers or risk the maximum surcharge applying; the Commissioner must take steps and send statutory warning letters before the TFN default rules bite (s5(3)–(4)). The TFN rules create an administrative compliance cost for members and a modest record‑keeping and contact burden for superannuation providers and the Commissioner. The Act creates a time window: if the member does not quote the TFN within 3 months of the warning letter, the Commissioner must send a further letter before some default consequences will cease to be inapplicable (s5(4)).\n\n- Concrete trade‑offs and other practical effects: the sliding scale formula (s5(1)) and the maximum percentage (s5(2)) create predictable marginal rates on surchargeable contributions for the two specified years. The pre‑7 May 1997 exception in the TFN default rule (s5(3)(d)–(e)) creates a specific treatment difference depending on when contributions began, which may affect record searches and member behaviour. Indexation rules (s6, s7) reduce the need to reset numeric thresholds manually each year but require reliance on wage index numbers and quarterly SG charge percentages published elsewhere (s6(2), s7(3)). Rounding and numeric‑precision rules are built into the Act (s5(1A), s7(2), s7(4)).\n\n- Implementation risks and administrative requirements: the Commissioner must publish indexed amounts for 2004–05 (s7(6)), and the threshold formula depends on data published under the Superannuation Guarantee (Administration) Act 1992 (s6(2)) and on ABS wage index numbers (s7(3)). Errors or delays in those external data sources, or in the Commissioner’s publications, could cause practical uncertainty about exact numeric thresholds for particular years.\n\n- Legal limits on reach: the Act contains a severability provision where Commonwealth power would be exceeded in relation to a State (s8) and an express non‑taxation of State property (s9). Those clauses narrow the Act’s constitutional footprint.\n\nKey sections to consult in the text: section 4 (imposition), section 5 (rates, bands, TFN default rules and calculation precision), section 6 (surchargeable contributions threshold and indexation inputs), section 7 (indexation mechanics for 2004–05 and publication duty), section 8 (severability) and section 9 (State property exemption)."}},"importantCases":[],"_links":{"self":"/api/acts/superannuation-contributions-tax-imposition-act-1997","history":"/api/acts/superannuation-contributions-tax-imposition-act-1997/history","analysis":"/api/acts/superannuation-contributions-tax-imposition-act-1997/analysis","conflicts":"/api/acts/superannuation-contributions-tax-imposition-act-1997/conflicts","importantCases":"/api/acts/superannuation-contributions-tax-imposition-act-1997/important-cases","documents":"/api/acts/superannuation-contributions-tax-imposition-act-1997/documents"}}