Super argument over the fabulously wealthy
A war of words has broken out over superannuation, triggered by former Labor Minister, now back bencher, Simon Crean, when he declared on Sunday that he would do ‘whatever I can’ to prevent further ‘tinkering’ to superannuation concessions.
Trade minister Craig Emerson responded, by saying that the Gillard Government was “…developing proposals that are fair and equitable because we believe that the few at the very top end are enjoying tax concessions that can't be afforded by the budget.”
He went on to describe the ‘few at the top end’ as ‘fabulously wealthy’, indicating they were fair game for reductions in their concessions.
The leader of the Opposition, Tony Abbott, has described any tax increase for the higher income earners as a ‘betrayal’, that voters’ money would be ‘safe with us’ (an Abbott Government) but refused to commit to reverse any such changes made by a Gillard Government. Confused? Read on
The superannuation argy-bargy is not a new story, but it certainly has a new spin. For a while now the collation has accused Treasurer Wayne Swan of ‘class warfare’, in particular of attacking the super rich such as Titanic replica builder Clive Palmer and mining heiress, Gina Reinhardt.
But what is rich, and what is super rich and who is looking after the vast bulk of people who are really struggling on less than $80,000 a year, rather than those ‘eking out’ an existence on $250,000?
The changes currently under discussion would only apply to Australia's richest one or two per cent. According to the Sydney Morning Herald, “it is understood the bottom 30 per cent of income earners received 1.2 per cent of the total value of super concessions in 2009-10, whereas the top 1 per cent received a 9 per cent share.”
So we are looking at reductions in highly favoured concessions for 1-2 per cent of Australians who can afford it the most. What is the problem with this?
On the other hand, one of the very few Coalition proposals to be put on the table is a removal of the super tax offset for low income earners – about 3.5 million Australians earning less than $37,000 a year.
So when Tony Abbott says, “Your money is safe with us”, you can rest easy if you are in the top 1-2 per cent. If you are one of the 3.5 million on struggle street, you should be worried, very worried indeed.
What do you think? Is the Labor Government on the right track targeting the top 1-2 per cent? Or do you think your money is indeed safe with Tony?
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