POWERED BY MOMENTUM MEDIA
(February-2004) Govt proves its favouritism of super
The Federal Government’s insistence that superannuation is already receiving suitably beneficial tax treatment appears to have been validated by the Treasury’s January release of its Tax Expenditure Statement for 2003.
The Treasury report reveals that a total of $30 billion in tax expenditure benefits were delivered through the tax system in the last financial year and that superannuation was the largest single beneficiary.
According to the Treasury report, the largest tax expenditures for 2002-03 were the concessional treatment of funded superannuation at around $9.6 billion — which is forecast to provide a benefit to taxpayers of around $10.5 billion in 2003-04.
Superannuation concessions for 2003-04 are forecast to be:
n under taxation of employer contributions: $5.85 billion;
n under taxation of fund earnings: $4.42 billion;
n deduction for contributions by the self-employed: $260 million;
n measures for low-income earners (including the Government's co-contribution): $10 million;
n spouse contributions and rebates: $20 million;
n CGT discount for super funds: $310 million.
These concessions are offset by:
n Tax on funded pensions (indeterminate, but likely to be significant);
n tax on funded lump sums (pre-July 1983): $20 million;
n tax on funded lump sums (post-June 1983): $360 million.
AUTHOR
Mike Taylor
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