The superannuation industry may finally get its wish on no more tinkering with the superannuation tax settings, if the Federal Treasurer, Scott Morrison, sticks to his word following this week’s passage through Parliament of the Government’s Budget changes.
The Association of Superannuation Funds of Australia (ASFA) welcomed the passage of the changes and called for no further tinkering, while Morrison signalled that the package would remain unchanged for at least the life of the current Parliament.
Discussing the passage of the legislation at a media conference, the Treasurer said the reason the Government had adopted a holistic approach was that it did not intend to pursue further change.
“This is our package. This is why we did it holistically, this is why we did it comprehensively,” he said. “Where the system can always be improved for the benefit of superannuants, that’s always an objective of every Government, but when it comes to the tax measures that sit around superannuation this is what we have done and we need to have the stability and certainty of these measures now being in place.”
The Treasurer characterised the Australian Labor Party as having foreshadowed further tax changes to super and suggested that this was what would differentiate the parties at the next Federal Election.
Welcoming the passage of the legislation, ASFA chief executive, Dr Martin Fahy said the tax changes addressed issues of equity and sustainability in Australia’s retirement income system.
“ASFA advocated for a ceiling on the amount of superannuation that is tax free in retirement and this policy has landed at the right point,” he said.
The Australian Institute of Superannuation Trustees (AIST) chief executive, Tom Garcia was similarly positive saying the new measures would help make super fairer and more sustainable and their clear passage through Parliament would help instil confidence in super.
“While the industry still has some work to do to successfully implement these changes, working Australians can now plan their retirement with more certainty about the rules,” Garcia said.
Both Fahy and Garcia particularly welcomed the Low Income Super Tax Offset (LISTO).
The major problem is now the ridiculous asset test for retirees. New Zealand has no income or asset test for retirees, with Kiwis happily working into their 70’s, paying income tax, but not being penalised for saving, like here. The NZ system works well, not to mention saving taxpayers funds by not having to employ thousands of people [as they do in Canberra], paid to watch what your share portfolio is doing each day. If your investments do well here, you get massacred. Whereas if you invest all your spare savings & inheritances into a million dollar home, you can get the full aged pension. What a farce. If Labor was smart, they would introduce such a system as operates in New Zealand.