The sharemarket plunge has exposed how about 80,000 self-funded retirees with large superannuation balances could suffer unrecoverable tax losses if Labor’s proposed changes are enacted.

Peter Burgess, chief executive of the Self Managed Superannuation Association, said the current sharemarket turmoil was the perfect illustration as to why the proposed additional 15 per cent tax on earnings, including on unrealised gains, could not work.