Tax income, not super: ASFA
The Association of Superannuation Funds of Australia (ASFA) has used its pre-budget submission for the next financial year to again call for the complete abolishment of the 15 per cent super contributions tax.
To back up its call for tax reform ASFA included in its proposal paper, which was submitted to Canberra yesterday, research done by ANOP of 24 to 64-year-olds showing that 75 per cent would prefer the Government remove the 15 per cent contributions tax than offer an income tax cut of $6 per week.
If the tax were removed in the next budget, the average wage earner would benefit by around $30 a week in retirement according to ASFA.
Chief executive Phillipa Smith said the Government’s good fiscal management put it in the “ideal” position to now abolish or at least greatly reduce the contributions tax.
ASFA estimated in the submission that the total abolishment of the contributions tax would cost around $3.3 billion.
Also in ASFA’s submission are more calls for the existing co-contribution threshold to be lowered so full benefits of 1.5 times the extra contribution is still offered by the Government to people earning up to $40,000 a year, with the benefits phasing out at $60,000.
ASFA has also recommended that the $450 a month earnings threshold for superannuation guarantee payments be abolished.
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