No ‘adverse tax changes to super’ in budget

Font Size:

Coalition senator Jane Hume says the government will abide by its election promise, assuring Australians that there “will be no adverse changes to taxes in superannuation” at the next federal budget.

However, there will be “necessary tinkering” within the regulatory settings of super.

The senator’s statement sets many a mind at ease, after much speculation that the government may implement major changes to the taxation of super in the federal budget this year, as a result of its Retirement Income Review findings.

In the lead-up to the 2019 federal election, the Morrison government guaranteed Australians that it would not create new taxes on superannuation.

Many believed Mr Morrison was merely taking the opposite stance to Labor’s plans to scrap cash refunds on dividend imputation credits, implement changes to the Division 293 tax threshold and lower non-concessional contribution caps.

However, according to a Nest Egg report, following the economic fallout from COVID-19, finance and superannuation commentators predicted that the government may implement significant policy changes to the Age Pension system and taxation rate for superannuation as ways to mitigate the budget deficit.

Senator Hume said the government will not change taxes to super, but there will be “necessary tinkering within the regulatory settings for superannuation”.

“This does not necessarily mean instability and uncertainty for members. It simply means that our superannuation funds are held to the highest standards of accountability and transparency,” she said.

She reiterated that the government will delay introducing legislation affecting the retirement income framework.

“Instead, the government will give effect to a principles-based retirement income covenant for consultation with the industry at a later date,” she stated.

“I’d like to see trustees ensure that members have more options to draw down on their retirement savings in order to maximise their living standards in retirement.”

Are you pleased that super taxes will remain as they are?

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Join YourLifeChoices today
and get this free eBook!

Join
By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy

RELATED LINKS

Super tax breaks back on agenda

Financial Services Inquiry head, David Murray, has called for the new PM to rethink super.

Who'll be hit hardest by COVID-19 pandemic – and who'll pay for it

Spare a thought for those who'll be hit hardest and those who'll pay the bill, says ANU.

What COVID-19 taught us about investing for retirement income

The ‘Bears' are up against the ‘Goldilocks' to see whose savings perform the best.

Written by Leon Della Bosca

Leon Della Bosca is a voracious reader who loves words. You'll often find him spending time in galleries, writing, designing, painting, drawing, or photographing and documenting street art. He has a publishing and graphic design background and loves movies and music, but then, who doesn’t?

Contact:
LinkedIn
Email

61 Comments

Total Comments: 61
  1. 0
    0

    Here we go again! What do they mean by ‘tinkering’? So sick and bloody tired of constant changes that don’t affect them.

  2. 0
    0

    older & wiser, i am completely in agreement with you. Why cant they come straight out and tell us what they are going to do!! “Tinkering” Pollie talk that worries me..

  3. 0
    0

    With a $400billion debt for COVID I am most concerned about the devaluation of Super. Its pointless spending all this money to save the oldies if the oldies have no money to live on. Please can the Premiers open the borders and get our children back to work.

    • 0
      0

      Some industries are still doing well. Look at the increase in online shopping, hard to find.a tradesman, holiday accommodation in parts of regional Qld say they are fully booked until Xmas. A free for all would be a lot worse for the economy

  4. 0
    0

    In the words of Jane Austern:

    It’s not what you SAY or THINK that defines you but what you DO.

    The LNP’s history of past superannuation “tinkering” demonstrate they will ONLY damage the superannuation of current and future superannuants.

    Remember there is one rule for us and another rule for them (of course).
    “Current Contribution Rates (from our taxes) for Senators and Members: 11 1/2 per cent of Annual Allowance” NB “Allowance” doesn’t just include salary.

    The rest of Australia?
    Still stuck on 9% and they have been, YET AGAIN, saying that industry still can’t possibly afford the overdue 1/2% increase. Originally, we would have been on a 12% contribution over a decade ago except for delays introduced by the LNP for years with the same lame excuse about affordability during the last 28 years of growth in the Australian economy. Defies logic.

    • 0
      0

      Iwould have no problems if the compulsory super contribution was set at 12% provided that there was an efficient means to stop people once they retire from blowing their supperannuation of a luxury world trip or some other expenditure, for example,buying a Mcmansion and luxury car and then lining up for the age pension because they are now poor enough to qualify.

    • 0
      0

      Have got to disagree with you entirely “Waiting to retire”. You say “stuck on 9%”. Of course industry can not afford the extra 1/2% increase. Many many small businesses are battling to pay 9%. If you want more in your super then salary sacrifice. Your super is YOUR responsibility not your employers.

    • 0
      0

      Alan, why do you think you have the right to tell people how to spend THEIR money?
      The government itself has linked Super increases to wage raises by insinuating that the Super increase will impact on them. This means that the money retirees get from Super is theirs to do with what they want. If you get a pay rise and put that money in the bank untill your retirement, are you happy with the government telling you how you can spend it?
      Super is an individuals money that has been invested on their behalf, it is often paid in lieu of pay rises, it belongs to the people who own the account that it is transfered to.
      This government wants people to be dependant upon OAP’s, that way they can control the way the money is managed. Self Funded Retirees are just too hard for them to control.

    • 0
      0

      Oops ‘Waitingtoretire’ & ‘Fliss’ – the current SGC rate is 9.5% – NOT 9%. Has been since July 1st, 2014. It is still slated to begin with an increase from 9.5 per cent to 10 per cent on 1 July 2021 and rising to 12% by 2024.

    • 0
      0

      Increasing the SGC will do nothing for most workers, who will merely sacrifice age pension income because they have more savings – and will lose out on wage increases because employers simply cannot pay both extra super and higher wages. Increasing the SGC will be a huge gift to the well off, with their excessively generous tax concessions that are costing the nation more than the total cost of the OAP. It’s time average Aussie’s woke up to the massive superannuation scam and stopped ranting about extra contributions, but instead demanded the tax concession system be fixed.

    • 0
      0

      For many compulsory super has been the only savings they have, andbhhas made a difference to their retirement

  5. 0
    0

    Governments of all persuasions love playing with other peoples money. Time for cash and gold bars under the bed. I bet they will not even ask us to bend over before the screw us out our money again.

    • 0
      0

      That’s the problem with governments, they are allways dealing with other peoples money. If itcwas their own they wouldn’t waste it on electioneering and badly constructed projects.

  6. 0
    0

    State governments will not let people go back to work to get the economy back on track and also to save peoples’ livelihoods, homes etc., but they will allow the AFL to play and actors to enter the country so they can work and help the economy. Unbelievable! If it is good for the AFL and overseas, interstate actors etc., to work to help the economy, why not everyone? It is not just double standards but doesn’t make sense when only some are allowed back to work and others are denied the right. People can still work if they practice good hygiene, distancing and wearing masks. Got to happen soon or there will be no economy at all.

    • 0
      0

      Priscilla, You nailed it!

    • 0
      0

      It is all a question of fine tuning Priscilla, the big money movement events can happen with very little risk but everyone doing it would just start another wave.

      Not so sure the economy is in much trouble, – it is almost impossible to get a builder or other trady at the moment, every body is so busy they are suffering stress because not enough time to meet demand.
      A lot of industries work from home as well, I think the essential parts of our economy are in good shape.

    • 0
      0

      One small point and that is it was the Federal Governments decision to allow actors to come in from overseas. I agree about the AFL. NRL and cricket players to cross borders.

    • 0
      0

      I think the frustration is understandable but I think we sometimes assume that “everyone” will follow the rules.

      Unfortunately that wasn’t, isn’t and likely, will never be the case in this country (as elsewhere). True, some of your AFL and NRL ‘exemptees’ have broken the rules of their exemptions, but in most cases they have been penalised. It is easier to monitor them, as a group, because we know (at all times) where they should be. Can’t say that for the rest of us without deploying all members of our 28,000 defense forces.

      With South Australia having opened up to ACT and likely to do so with NSW (when they have a 14-day period with no unknown source infections) your/our desired “help the economy” is underway. SA is discussing with Qld to see if they are prepared to reduce their 28 day non-unknown source infections, there is hope that Qld can open to SA/NSW/TAS/NT/WA/ACT. Then, Vic will have to achieve the same goal. Only problem is that the Chief Ministers/Premiers are having to do the negotiation as the Prime Minister, the Minister for Health, The Treasurer and the Minister for Finance ONLY WISH TO SCORE POLITICAL POINTS. Your health, my health and everyone’s health is more important then that.

      Opening up too early, against HEALTH advice, will only see a more devastating impact on the economy when we would have to inevitably go back into a full lockdown when the virus spreads again. With everyone starting from the same start point (14 straight days without a non-traceable infection) together we have the best chance to manage things until we have a workable vaccine. That’s the commUNITY we needed to manage things going forward.

      In such times we shouldn’t be turning ON each other but rather TO each other.

    • 0
      0

      Waiting to retire, you are so wrong with your comments “Only problem is that the Chief Ministers/Premiers are having to do the negotiation as the Prime Minister, the Minister for Health, The Treasurer and the Minister for Finance ONLY WISH TO SCORE POLITICAL POINTS”.

      The Federal Government has NO jurisdiction over the states.

      If anyone is playing politics it the the Premieres of the (closed) states with QLD in particular far more focussed on her re-election next month and playing to the peanut gallery than addressing any possible health issue that might have been caused by allowing the pregnant woman to get emergency treatment that may have saved her child, the four kids under 13 to visit their dying father, the nurse from ACT (who have had no cases for over 2 months) to visit her dying father or attend his funeral. And that does not even consider the cross-border town (which has never had a single case of COVID-19) who are not allowed to cross state lines to the nearest supermarket after their own burned down resulting in a 150k one way trip to the next nearest shop.

      I agree opening up too early may result in a third wave of infections, BUT the response could be far more nuanced than it is at the moment even in Victoria.

    • 0
      0

      Yep! Agree KSS.

    • 0
      0

      KSS no one mentions the other States with closed borders and same restrictions. The beat up on Qld is purely political. The dying father hadnt been in contact with is children for 4 years and had chosen not to pay child support. We can see what happems in Victoria.and oversead when borders are opened too soon

    • 0
      0

      As a Queenslander, I want a Premier who is looking after my interests, not SCOMO,s and not multimedia magnates who don’t even live in this country.
      If we open our borders too soon, we face the prospect of starting all over again. This certainly will destroy the economy.

  7. 0
    0

    When will we get rid of State Governments ? Set up at the turn of last century, the world has changed. Communications no longer a problem. Want to save massive amounts of money ? Expand local councils, marginally increase fed nu8mbers and scrap state governments before they send us totally broke. This pandemic should have been handled completely at federal level. The duplication of services by the highly paid state pollies and all their consultancy mates in a country with a population of 25m is hideous.

    • 0
      0

      inextratime, the State Govenments are the ones handling the pandemic, and are handling it effectively and supported by the majority of the people, – Morrison would have been just as stupid as Trump, – witness the way he took Trumps line of attacking China, – has that worked out well for Australia?

      Morrison gives lip service to rebuilding Australia’s manufacturing base, but so far only the States are doing anything about it, the Federal Govt, – particularly the Liberal party, has consciously and deliberately destroyed Australia’s manufacturing industry so that it is now almost impossible to buy genuine “Australian Made”.

      This was at the behest of their American masters yet they blamed it all on the unions, – who have to accept some blame, but not the majority.

      You may reflect on the total reliance of Australia on imports, and the poor future of our youth for employment, but what does one call a government that destroys their own economy, – what do you call someone who opens the city gates to the invaders?

    • 0
      0

      Cant happen fast enough, bulging bureaucracy’s, no responsibility for debt, spend, spend, spend.

    • 0
      0

      I’d rather get rid of the Federal Government that we have at the moment, it’s the state governments looking after us, not Scotty from marketing.

    • 0
      0

      No get rid of the Federal Government. Put a COAG team in place instead,

      Get the Party out of local Government by appointing public administrators not attached to the Property Council in charge,.

      The States do a good job running education, health while all the Feds do is pour more immigrants in to destroy capacity, year after year.

    • 0
      0

      Yes Rae because COAG worked so well right? The place where issues were taken that you didn’t want to act on because they would never agree to anything.

    • 0
      0

      I did not mention which Political party should run the country and if you think the states have done a good job of handling the pandemic, talk to the hundreds of thousands that are now out of work. The real cost of the State’s management of this pandemic will not be totally realised for a year or two yet and the States know it. But don’t let political propaganda get in the way of the facts.

  8. 0
    0

    The definition of ‘tinkering’ by government when it comes to super…simply means more for them – less for you!

  9. 0
    0

    Tinker Tinker Tinker That’s all they ever do .They haven’t the guts to to consult, implement properly work it out . Can Never see the big picture And. it will probably never affect them .scared of losing votes .or they just haven’t a clue what they are doing

  10. 0
    0

    Wonder if “tinkering” means another attack on the only super funds worth having – industry super funds. After all, they are outside of the old boys network that runs this country – media, governments of all persuasions, highly paid chairmen and board members, CEO’s – and are influencing how big business should be run for the benefit of consumers, not for the good old boys or wealthy shareholders. Cynical? Yes! Realistic, also Yes!

Load More Comments

FACEBOOK COMMENTS



SPONSORED LINKS

continue reading

Finance

Five smart moves for empty nesters

So, the kids have moved out, your home is finally yours again and you have ascended to the rank of...

Lifestyle

Why you turn down the radio when you're trying to park your car?

When you're looking for a destination, you might need to cut down the volume. Shutterstock Simon Lilburn, University of Melbourne...

Technology

Why we can expect smarter healthcare in 2021 and other tech trends

With last year dominated by the COVID-19 pandemic and much the same expected for 2021, it is unsurprising that healthcare...

Mental Health

Drug trial offers rare hope on Alzheimer's disease

There is finally a glimmer of hope in the fight against Alzheimer's, the most common form of dementia, which affects...

Pets

How the pandemic has turbocharged the pet care industry

Pet care is a big business, and the pandemic has made it bigger. An Animal Medicines Australia report says Australians...

Travel News

Australian government divided on lifting overseas travel ban

The federal government is divided about when international air travel will recommence for Australians, as consumers signal their intent to...

Food

Dietitian reveals the breakfast swaps worth making

If you're looking to live a healthier lifestyle, breakfast is a good place to start. It's the first meal of...

Finance News

COVID driving more older Australians into poverty

Many of us who endured lockdowns in Australia are familiar with the surge in energy bills at home. But for...

LOADING MORE ARTICLE...