The Federal Treasure, Scott Morrison has given a commitment to the self managed superannuation funds sector that the Government has no intention of tightening or removing limited recourse borrowing arrangements (LRBAs).
In an address to the SMSF Association technical conference, Morrison stated “we’re not touching the arrangements around limited recourse borrowing arrangements” even though it had received recommendations to do so.
“We haven’t been convinced there is an issue with this when it comes to the SMSF sector, as a proportion of the investment property sector and the property sector more generally, it is quite small,” the Treasurer said.
However he warned that if there appeared to be malfeasance or problems with the economy the Government might be forced to act.
“But there’s no evidence that has been presented to us to suggest that [malfeasance or economic problems] so the Turnbull Government has no plans whatsoever to change those arrangements,” he said.
“We know that the Labor Party does, they want to strip those LBRA arrangements away from self-managed super funds. So that’s a matter that is clearly before you to make determinations about,” Morrison said.
He said the whole point of self-managed super was to have more options and be able to acquire assets to provide for the future.
“Obviously, people have self-managed super funds, not everything they own and not everything they do is through their self-managed super funds, your portfolios can extend beyond that,” Morrison said. “So, we’re quite happy to see other areas of investment continue and we’ve ensured under the tax arrangements, particularly in the property market, that will remain as well.”