The Australian Council of Social Service (ACOSS) has sought to stiffen the Government’s resolve on key elements of its Budget superannuation changes.
ACOSS chief executive, Cassandra Goldie said this week the Government should hold the line on its proposed curbs on tax breaks for superannuation for people on the highest incomes, describing them as “modest changes” while urging greater help for low income earners.
“These are modest changes. After they are introduced, the average level of government support for retirement incomes (tax breaks and pensions) for the top one per cent of wage earners will only fall from $850,000 to $650,000 over their lifetime,” she said.
“Support for those in the lowest 10 per cent is estimated by Treasury to be just over $300,000.”
“We urge the Government to take a step further and improve support for saving by people with low incomes by doubling the proposed tax offset for people with low incomes (LISTO). This would bring a much better balance to the taxing of superannuation so that tax concessions for superannuation are better targeted to the core purpose of superannuation,” Goldie said.
She said that under the present system, a person earning $200,000 saved 34 cents per dollar contributed to super but a worker on $20,000 or less received no tax break at all and that the proposals being pursued by ACOSS would go some way to fixing this inequity.
“This would ensure scarce government resources are directed at achieving the core purpose of superannuation — delivering decent retirement incomes for people who will otherwise rely mainly on the Age Pension,” Goldie said.
