Despite Bill Shorten’s call for tougher super tax measures to raise more revenue, the much-discussed super changes will be introduced in to Parliament today.
Treasurer Scott Morrison will try to secure passage of the bills to change superannuation legislation before Parliament rises for the end of year holiday. Announced in the Federal Budget 2016/17, the proposed changes have already undergone tweaks to help secure the support of Coalition backbenchers. However, as of yesterday, Bill Shorten was calling for a further change to the annual non-concessional contribution cap.
Currently, the cap limit is $180,000 per annum and the Government’s proposed legislation will reduce it to $100,000. For those with more, no further non-concessional contributions can be made. Mr Shorten is calling for the limit to be further reduced to $75,000, a measure he says will raise a further $1.4 billion in revenue.
The Opposition Leader said that the Government had made a mess of the super changes and Labor had an eye on the bottom line, “What we’re committed to doing at all times is improving the Budget bottom line,” Mr Shorten said.
“What we have learnt today is Labor has a secret super tax,” Scott Morrison responded, further adding on Twitter: “The super system needs to be improved, but to implement significant changes you have to be upfront with people.”
As a recap, here are the changes that the Government’s proposed legislation will introduced today:
- $1.6 million cap on balances in retirement income accounts
- reduce the income tax threshold on concessional contributions to $250,000
- reduce the annual concessional contribution cap to $25,000
- allow concession contribution of $100,000 per year for those with super balances of less than $500,000
- increase innovation in retirement income stream products by removing regulatory barriers
- Low Income Super Tax Offset, capped at $500, for those earning less than $37,000 per year
- tax-free status of transition to retirement income streams removed
Are you any clearer about how the changes to super will affect your retirement income planning? If so, do you support or oppose the changes proposed by the Government? Do you think Bill Shorten’s further change to be incorporated? Do you expect to be better or worse of if changes are passed?