{"id":"C2004A00320","name":"Superannuation Supervisory Levy Imposition Act 1998","slug":"superannuation-supervisory-levy-imposition-act-1998","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"60 of 1998","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":5962,"registerId":"commonwealth-C2004A00320-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Short title","content":"#### 1 Short title\n\n  This Act may be cited as the Superannuation Supervisory Levy Imposition Act 1998.","sortOrder":0},{"sectionNumber":"2","sectionType":"section","heading":"Commencement","content":"#### 2 Commencement\n\n  (1) This Act commences on the commencement of the Australian Prudential Regulation Authority Act 1998.\n  (2) If this Act commences during a financial year (but not on 1 July of that financial year), this Act has effect in relation to that financial year subject to the modifications specified in the regulations.","sortOrder":1},{"sectionNumber":"3","sectionType":"section","heading":"Act binds the Crown","content":"#### 3 Act binds the Crown\n\n  This Act binds the Crown in each of its capacities.","sortOrder":2},{"sectionNumber":"4","sectionType":"section","heading":"External Territories","content":"#### 4 External Territories\n\n  This Act extends to each external Territory.","sortOrder":3},{"sectionNumber":"5","sectionType":"section","heading":"Definitions","content":"#### 5 Definitions\n\n  In this Act, unless the contrary intention appears:\n\n> indexation factor means the indexation factor calculated under section 8.\n\n> index number, in relation to a quarter, means the All Groups Consumer Price Index number, being the weighted average of the 8 capital cities, published by the Australian Statistician in respect of that quarter.\n\n> levy imposition day, in relation to a trustee of a superannuation entity for a financial year, means:\n\n    (a) if the superannuation entity is a superannuation entity on 1 July of the financial year—that day; or\n    (b) in any other case—the day, during the financial year, on which the superannuation entity becomes a superannuation entity.\n\n> statutory upper limit means:\n\n    (a) for the financial year commencing on 1 July 2020—$10,000,000; or\n    (b) for a later financial year—the amount calculated by multiplying the statutory upper limit for the previous financial year by the indexation factor for the later financial year.\n\n> superannuation entity means an entity that:\n\n    (a) is a superannuation entity within the meaning of the Superannuation Industry (Supervision) Act 1993; and\n    (b) is not a self managed superannuation fund within the meaning of that Act.\n\n> trustee, in relation to a superannuation entity, means the person who is the trustee of the entity for the purposes of the Superannuation Industry (Supervision) Act 1993.\n\n> unregulated entity at a particular time means:\n\n    (a) a fund, trust or scheme that, at that time, is not a superannuation entity within the meaning of the Superannuation Industry (Supervision) Act 1993; or\n    (b) a fund or scheme that, at that time, is a self managed superannuation fund within the meaning of that Act.","sortOrder":4},{"sectionNumber":"6","sectionType":"section","heading":"Imposition of superannuation industry supervisory levy","content":"#### 6 Imposition of superannuation industry supervisory levy\n\n  Levy payable in accordance with subsection 8(6) of the Financial Institutions Supervisory Levies Collection Act 1998 is imposed.","sortOrder":5},{"sectionNumber":"7","sectionType":"section","heading":"Amount of levy","content":"#### 7 Amount of levy\n\n  (1) Subject to subsection (2), the amount of levy payable by a trustee of a superannuation entity for a financial year is the sum of the restricted levy component and the unrestricted levy component for the financial year.\n\n> Note: For restricted levy component, see subsection (1A). For unrestricted levy component, see subsection (1B).\n\n  (1A) The restricted levy component for the financial year is:\n    (a) unless paragraph (b) or (c) applies—the amount that, for the financial year, is the restricted levy percentage of:\n    (i) except where the superannuation entity was an unregulated entity on 30 June of the previous financial year—the superannuation entity’s levy base on that day; or\n    (ii) if the superannuation entity was an unregulated entity, or was not in existence, on 30 June of the previous financial year—the entity’s levy base on the day when the entity became a superannuation entity; or\n    (b) if the amount worked out under paragraph (a) exceeds the maximum restricted levy amount for the financial year—the maximum restricted levy amount; or\n    (c) if the amount worked out under paragraph (a) is less than the minimum restricted levy amount for the financial year—the minimum restricted levy amount.\n\n> Note: The restricted levy percentage, maximum restricted levy amount, minimum restricted levy amount and the method of working out the superannuation entity’s levy base are as determined under subsection (3).\n\n  (1B) The unrestricted levy component for the financial year is the amount that, for the financial year, is the unrestricted levy percentage of:\n    (a) if the superannuation entity was an unregulated entity, or was not in existence, on 30 June of the previous financial year—the entity’s levy base on the day when the entity became a superannuation entity; or\n    (b) otherwise—the superannuation entity’s levy base on 30 June of the previous financial year.\n\n> Note: The unrestricted levy percentage is as determined under subsection (3).\n\n  (2) If the levy imposition day for the trustee of a superannuation entity for the financial year is later than 1 July in the financial year, the amount of levy payable by the trustee for the financial year is the amount worked out using the following formula:\n  ![](image.002.png)\n  (3) The Treasurer is, by legislative instrument, to determine:\n    (a) the maximum restricted levy amount for each financial year; and\n    (b) the minimum restricted levy amount for each financial year; and\n    (c) the restricted levy percentage for each financial year; and\n    (ca) the unrestricted levy percentage for each financial year; and\n    (d) how a superannuation entity’s levy base is to be worked out.\n  (4) An amount determined under subsection (3) as the maximum restricted levy amount for a financial year must not exceed the statutory upper limit for the financial year.\n  (4A) A determination under subsection (3) may make different provision for different classes of superannuation entity.\n  (5) Without limiting subsection (3), the Treasurer may make more than one determination, for a financial year, about any or all of the matters referred to in that subsection.","sortOrder":6},{"sectionNumber":"8","sectionType":"section","heading":"Calculation of indexation factor","content":"#### 8 Calculation of indexation factor\n\n  (1) The indexation factor for a financial year is the number worked out by:\n    (a) ascertaining the index number for the most recent quarter for which the Australian Statistician has published an index number, as at the start of the day on which the Treasurer makes the first determination under subsection 7(3) of an amount or percentage for the financial year; and\n    (b) dividing that index number by the index number for the quarter 12 months before the quarter mentioned in paragraph (a); and\n    (c) adding 0.030 to the number worked out under paragraph (b).\n  (2) The indexation factor is to be calculated to 3 decimal places, but increased by .001 if the 4th decimal place is more than 4.\n  (3) Calculations under subsection (1):\n    (a) are to be made using only the index numbers published in terms of the most recently published index reference period for the Consumer Price Index; and\n    (b) are to be made disregarding index numbers that are published in substitution for previously published index numbers (except where the substituted numbers are published to take account of changes in the index reference period).","sortOrder":7},{"sectionNumber":"9","sectionType":"section","heading":"Regulations","content":"#### 9 Regulations\n\n  The Governor‑General may make regulations for the purposes of subsection 2(2).","sortOrder":8}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":5,"scope_assessment":{"changed":false,"description":"The legislation appears focused on its original purpose of imposing a supervisory levy on superannuation entities. The structure remains consistent with a standard levy imposition act, with mechanisms for annual adjustment via delegated legislation rather than expansion of substantive scope."},"complexity_factors":["Nested conditional logic in section 7 with multiple paragraphs (a), (b), (c) and sub-paragraphs (i), (ii) determining levy calculations","Cross-references to external legislation: Superannuation Industry (Supervision) Act 1993 and Financial Institutions Supervisory Levies Collection Act 1998","Mathematical formula with indexation calculations involving CPI data and specific rounding rules (3 decimal places, rounding up)","Delegated legislative power: Treasurer determines 5 key variables (percentages, amounts, calculation methods) via legislative instrument","Temporal complexity: Different calculation dates depending on whether entity existed on 30 June or became regulated mid-year","Pro-rata formula in subsection 7(2) requiring image reference (indicating mathematical complexity)","7 defined terms in section 5, some with nested definitions (e.g., 'superannuation entity' excludes self-managed funds by reference to another Act)"],"plain_english_summary":"**What this law does:**\n\nThis Act creates a **levy** (a type of tax or fee) that superannuation funds must pay to fund the government's supervision of the superannuation industry. Specifically, it charges trustees (the people or companies legally responsible for managing super funds) an annual fee to cover the costs of regulatory oversight by APRA (the Australian Prudential Regulation Authority).\n\n**Who it affects:**\n\n- **Trustees of superannuation entities** — these are the legal managers of super funds (excluding self-managed super funds, which are regulated differently)\n- **APRA** — the regulator that collects these levies to fund its operations\n- **Treasurer** — who sets the actual dollar amounts and percentages each year\n\n**How the levy works:**\n\nThe levy has two parts:\n- **Restricted levy component**: A percentage of the fund's assets (the \"levy base\"), subject to annual minimum and maximum caps set by the Treasurer\n- **Unrestricted levy component**: An additional percentage of assets with no caps\n\nThe exact percentages, minimums, maximums, and how to calculate the fund's asset base are determined by the Treasurer each year through a **legislative instrument** (a formal decision published with legal effect).\n\n**Key features:**\n- The maximum restricted levy amount is capped at **$10 million** (as of 2020, indexed for inflation each year)\n- If a fund starts mid-year, the levy is **pro-rated** (adjusted proportionally for the part of the year it operated)\n- The cap increases annually based on **CPI inflation** plus an extra 3%\n\n**Why it matters:**\n\nThis ensures the superannuation industry pays for its own regulation rather than taxpayers funding it. It creates a sustainable funding model where larger funds pay more (since the levy is based on assets), while smaller funds pay at least a minimum amount to ensure basic supervisory costs are covered."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"summary":{"complexity_score":5,"scope_assessment":{"changed":false,"description":"The Act remains focused on its original purpose: imposing a supervisory levy on non-SMSF superannuation fund trustees to fund APRA's regulatory activities. The addition of an 'unrestricted levy component' (subsection 1B) and the statutory upper limit indexed to CPI represent refinements and inflation-proofing mechanisms consistent with the original intent, rather than a change in scope."},"complexity_factors":["Dual-component levy structure (restricted and unrestricted) with different calculation rules for each","Multiple conditional scenarios for determining the levy base depending on when the entity became regulated","Indexation mechanism using CPI with specific rounding rules and a supplementary 3% addition","Key financial parameters (percentages, minimums, maximums) are not set in this Act but delegated to annual Treasurer determinations, requiring cross-referencing","Pro-rata reduction formula for mid-year entrants references a formula image rather than plain text","Interaction with multiple other Acts (Superannuation Industry (Supervision) Act 1993, Financial Institutions Supervisory Levies Collection Act 1998, APRA Act 1998)","Distinction between 'restricted' and 'unrestricted' levy components may be non-intuitive for lay readers"],"plain_english_summary":"## What This Law Does\n\nThis Act creates an annual **supervisory levy** (a fee charged by the government) on large superannuation funds — essentially a bill that super fund trustees must pay each year to cover the cost of being regulated by APRA (the Australian Prudential Regulation Authority, which is the government body that oversees banks, insurers, and super funds).\n\n## Who It Affects\n\n- **Trustees of large superannuation funds** — anyone responsible for managing a superannuation fund that is *not* a self-managed super fund (SMSF). SMSFs are explicitly excluded and pay a different levy.\n- **Ordinary super fund members** are indirectly affected — the cost of the levy may ultimately be passed on through fund fees.\n\n## How the Levy Works\n\nThe levy has two parts:\n\n1. **Restricted component** — calculated as a percentage of the fund's \"levy base\" (essentially the size of the fund), but with a floor (minimum) and a ceiling (maximum). The maximum can never exceed a **statutory upper limit** of $10 million (for 2020–21, adjusted for inflation in later years using CPI).\n2. **Unrestricted component** — also a percentage of the fund's levy base, but with no floor or ceiling cap.\n\nThe exact percentages, minimums, and maximums are set each year by the **Treasurer** via a separate legislative instrument (a regulation-style document), giving the government flexibility to adjust the amounts annually.\n\nIf a fund only becomes a regulated super fund *part-way through* a financial year, the levy is reduced proportionally (pro-rated) based on how many days of the year it was regulated.\n\n## The Inflation Adjustment\n\nThe $10 million cap on the restricted component grows each year with inflation, using the **Consumer Price Index (CPI)** — the standard measure of how prices change over time — plus an additional 3% buffer.\n\n## Why It Matters\n\nThis is the legal foundation that authorises the government to charge super funds for the cost of being supervised. Without this Act, APRA could not collect the fees that fund its oversight activities. Good regulation of super funds protects millions of Australians' retirement savings."},"issue_detection":{"absurdities":[{"type":"other","section":"8(1)(c)","severity":"medium","reasoning":"The indexation factor is calculated by dividing a CPI index number by the index number 12 months prior, then adding 0.030. In a deflationary scenario where prices fall significantly, the CPI ratio could be less than 1.0, but adding 0.030 guarantees the factor exceeds 1.0 if deflation is less than 3%. More fundamentally, the addition of a flat 0.030 on top of actual CPI growth means the statutory upper limit grows faster than inflation every single year without exception. This appears economically irrational as a ceiling meant to track real costs but is structurally guaranteed to always ratchet upward.","confidence":0.82,"description":"The indexation factor formula unconditionally adds 0.030 to the CPI ratio, meaning the statutory upper limit can never decrease even in deflationary conditions, and will always grow by at least 3% regardless of actual economic conditions."},{"type":"circular_definition","section":"5 (definition of 'statutory upper limit'), 7(4)","severity":"medium","reasoning":"The definition of 'statutory upper limit' only provides a base value commencing 1 July 2020, with earlier years addressed only by the recursive formula referencing 'the previous financial year'. For financial years between 1998 and 2020, the statutory upper limit is undefined unless there were prior legislative provisions. The constraint in s7(4) that maximum restricted levy amounts must not exceed the statutory upper limit is therefore unenforceable or vacuous for all years prior to 2020, undermining the ceiling mechanism for over two decades of the Act's operation.","confidence":0.75,"description":"The statutory upper limit for financial years prior to 2020 is not defined, yet section 7(4) requires the maximum restricted levy amount not to exceed the statutory upper limit for 'a financial year' without temporal limitation, creating a gap for years 1998-2019."},{"type":"impossible_compliance","section":"7(2)","severity":"high","reasoning":"Where a levy imposition day falls after 1 July, the amount of levy is determined exclusively by a formula that appears only as an image reference. Any person seeking to comply with or enforce the levy obligation for mid-year entrants cannot ascertain the applicable amount from the text of the Act alone. While this may be an artefact of the document format provided, if reproduced in official instruments without the image, it creates genuine impossibility of compliance.","confidence":0.88,"description":"Section 7(2) references a formula contained in an image placeholder ('image.002.png') that is not reproduced in the legislation as provided, rendering the operative pro-rata levy calculation for late-entry entities entirely unknowable from the face of the Act."},{"type":"circular_definition","section":"8(1)(a)","severity":"medium","reasoning":"The statutory upper limit for a financial year depends on the indexation factor (s5). The indexation factor is calculated using the CPI number current as at the date of the Treasurer's first determination (s8(1)(a)). The Treasurer's determination of maximum levy amounts must not exceed the statutory upper limit (s7(4)). Thus the ceiling constraining the Treasurer's discretion is itself a function of when the Treasurer exercises that discretion - the Treasurer could influence the applicable CPI snapshot, and hence the statutory upper limit, by choosing when to make the first determination.","confidence":0.78,"description":"The indexation factor is anchored to the date the Treasurer makes the 'first determination' under s7(3), creating a circularity where the ceiling (statutory upper limit) used to constrain Treasurer determinations is itself calculated by reference to when the Treasurer chooses to make those determinations."},{"type":"other","section":"2(2), 9","severity":"low","reasoning":"The regulation-making power is entirely confined to the commencement modification scenario. This is not inherently absurd but is highly unusual - most imposition Acts carry broader regulation-making powers. If unforeseen operational issues arise beyond the commencement scenario, there is no mechanism within this Act to address them by subordinate legislation.","confidence":0.7,"description":"Section 2(2) contemplates that regulations may modify the Act's operation for a financial year in which it commences mid-year, but section 9 only empowers the Governor-General to make regulations 'for the purposes of subsection 2(2)' - creating an extremely narrow regulation-making power that cannot address any other operational matter."}],"contradictions":[{"severity":"medium","section_a":"7(1A)(a)(i)","section_b":"7(1A)(a)(ii)","confidence":0.72,"description":"The two subparagraphs establish mutually exclusive levy base reference dates but the condition triggering (ii) - that the entity 'was an unregulated entity, or was not in existence, on 30 June of the previous financial year' - overlaps ambiguously with the default in (i), creating uncertainty about which date applies to an entity that converted from unregulated status during the current financial year but after 30 June of the previous year."},{"severity":"medium","section_a":"7(1A)","section_b":"7(1B)","confidence":0.68,"description":"The restricted and unrestricted levy components use parallel but inconsistently structured conditions for selecting the levy base reference date. Section 7(1A) uses a three-tier structure with minimum and maximum caps, while section 7(1B) uses a two-tier structure with no caps. The conditions in (1A)(a)(i)/(ii) and (1B)(a)/(b) are drafted with subtly different language ('was an unregulated entity on 30 June' vs 'was an unregulated entity, or was not in existence, on 30 June') suggesting different operative scopes for the same factual trigger across the two components."},{"severity":"medium","section_a":"5 (definition of 'levy imposition day')","section_b":"7(1A)(a)(ii)","confidence":0.65,"description":"The levy imposition day definition in s5 addresses when levy is imposed on a trustee whose entity becomes a superannuation entity during the year. Section 7(1A)(a)(ii) uses the 'day when the entity became a superannuation entity' as the levy base reference date. However, s7(2) then applies a pro-rata formula based on the levy imposition day for trustees whose levy imposition day is later than 1 July. The interaction between these provisions creates potential double-counting or miscalculation where the levy base date and the pro-rata start date are defined by reference to the same event but through different definitional pathways."},{"severity":"low","section_a":"7(5)","section_b":"8(1)(a)","confidence":0.73,"description":"Section 7(5) expressly permits the Treasurer to make more than one determination for a financial year. Section 8(1)(a) calculates the indexation factor by reference to the date of the 'first determination under subsection 7(3)' for the financial year. If the Treasurer makes multiple determinations, subsequent determinations are still constrained by a statutory upper limit calculated using the CPI snapshot from the first determination date, even if significant time has elapsed. This creates an inconsistency where later determinations in the same year are governed by a potentially stale indexation factor, undermining the purpose of using a current CPI reference."}]}},"importantCases":[],"_links":{"self":"/api/acts/superannuation-supervisory-levy-imposition-act-1998","history":"/api/acts/superannuation-supervisory-levy-imposition-act-1998/history","analysis":"/api/acts/superannuation-supervisory-levy-imposition-act-1998/analysis","conflicts":"/api/acts/superannuation-supervisory-levy-imposition-act-1998/conflicts","importantCases":"/api/acts/superannuation-supervisory-levy-imposition-act-1998/important-cases","documents":"/api/acts/superannuation-supervisory-levy-imposition-act-1998/documents"}}