The Opposition's announcement on superannuation is a valuable and positive contribution to the debate on tax concessions for those with very high balances.
However, changes to the superannuation system should been considered as part of the broader taxation framework and the Association of Superannuation Funds of Australia (ASFA) will be actively participating in the Government's tax discussion paper process.
"Any proposal needs to be assessed against the principles of adequacy of retirement income, equity, simplicity and fiscal sustainability. It is also important that any changes maintain confidence in the system," says ASFA CEO Ms Pauline Vamos.
"Tax concessions in superannuation need to be viewed in the context of other investments and the impact that the change will have on individuals' motivation to save for their retirement.
"It is important that the community be brought on board to support any changes to the superannuation and taxation systems.
"This is why we have been contributing to the national debate on tax reform and called for tax concessions to be reduced for those on very high superannuation balances, that is, those above $2.5 million.
"Those with very high balances benefit from the low earnings tax in accumulation and no tax in retirement. However those on high incomes do not necessarily have high balances – particularly women – and are playing catch up. Just because you have a high income today does not automatically mean you have enough super.
"ASFA will consider this proposal in detail and we will continue to put facts and figures on the table so that we can have an informed conversation about superannuation tax issues, as a starting point for open discussions about the retirement incomes framework overall.
"We think superannuation is beyond politics; it is fundamental to our way of life and any changes arising from the national conversation should be bipartisan," Ms Vamos concluded.
For further information, please contact:
Katrina Horrobin: GM – Member Strategy, Communications & Brand, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia's superannuation industry. It is a not-for-profit, sector-neutral, and non-party political national organisation, which aims to advance effective retirement outcomes for members of funds through research, advocacy and the development of policy and industry best practice.