Superannuation funds should not be made to administer the changed superannuation tax regime around higher income earners, according to the Association of Superannuation Funds of Australia (ASFA).
Instead, ASFA has told the Government that the measure should be implemented by way of a personal tax on the individual, utilising the resources of the Australian Taxation Office (ATO).
As well, the ASFA submission makes it clear that the organisation does not generally support the Government's decision to reduce the level of tax concession to very high income earners.
It said it did not endorse the proposal and had reservations about the net increase to government revenues that would flow from implementing the measure.
However, it said that if the measure was to be implemented it should be "by way of a personal tax on the individual and not by way of a tax on the superannuation fund that received, or is holder, of the contributions".
The ASFA submission suggested that the ATO should model administration of the tax on the existing processes for levying and collecting excess contributions tax and that defined benefit funds should be given the capacity to offer a tax offset account to members so that payment might be deferred until the member's benefit crystallises.
In arguing against making superannuation funds integral to administration of the tax, the ASFA submission said that assessment against a fund could work smoothly and efficiently where a tax was applied uniformly across all members, but assessment against the individual was a better formula where differential tax rates applied.
