No surprise if Govt targets upper income earners
Suggestions that the Federal Government will target its Budget superannuation tax changes towards upper income earners will come as no surprise to most senior superannuation fund executives.
The Government is today expected to give substance to its approach to superannuation policy on the back of leaks of election-related advertising material pointing to the targeting of upper income, with some media reports suggesting those earning over $180,000 a year.
A roundtable conducted by Money Management's sister publication, Super Review has revealed a high expectation of changes targeting upper income earners, and a survey conducted during the recent Conference of Major Superannuation Funds revealed it as being the most likely Budget outcome.
However, the roundtable argued that if the Government was going to target the tax concessions enjoyed by upper income earners on equity grounds, then it should also be looking to continue funding to the Low Income Superannuation Contribution (LISC).
Australian Institute of Superannuation Trustees chief executive, Tom Garcia, said he believed the LISC should be retained and lamented the fact that there had been insufficient recognition in the political debate of the value it brought to lower income earners, particularly women.
Other executives sitting on the roundtable, including Willis Towers Watson executive, Nick Callil, suggested that both sides of politics appeared to recognised that upper income earners were able to be targeted in terms of tax concessions.
"I'm assuming that the Government will come out with changes in the Budget which won't be the same as those [the ALP's policy changes], but will also change tax and possibly make it a little less attractive for higher income earners," he said.
The Pillar Administration/Super Review survey conducted during the CMSF conference revealed that nearly half of respondents (47.1 per cent) believed reducing tax concessions to upper income earners was the priority Budget issue for the Government.
Recommended for you
The Reserve Bank of Australia (RBA) has lowered rates to a level not seen since mid-2023.
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
