Enshrining super will guide future policy: IPA
Legislation to enshrine the objective of the superannuation system may seem like a backward step, but it is necessary to guide future reforms and restore trust in the system, the Institute of Public Accountants (IPA) said.
IPA chief executive, Andrew Conway, said the original objective of superannuation should not be lost when changes are made to the system in this year's Federal budget.
"It may be ironic that we have to go backwards to go forward but the IPA believes this is an important step in the evolution of our superannuation system. We need to address anomalies and stop the constant tinkering which generates distrust in the system," he said.
"We agree that an updated legislated objective will serve as a guide to future reforms assisting policy-makers, regulators, industry and the community about the fundamental purpose of superannuation."
Conway said that while the goal of super was to achieve sustainable retirement outcomes, this should not be open-ended, proposing the government should limit tax concessions above a certain level to prevent super from being used as an estate planning tool.
He also suggested bringing in higher levels of tax on the transfer of death benefits to non-dependants as bequests.
"The objective of our retirement system is to improve retirement incomes, but there needs to be a limit to the amount of taxpayer support to ensure fiscal sustainability," Conway said.
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