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AIST urges Senate to keep LISC scheme
The Australian Institute of Superannuation Trustees (AIST) is urging the Senate to keep the Low Income Superannuation Contribution (LISC) scheme, saying it will benefit many low-income earning Australians.
AIST will ramp up its efforts to save the LISC scheme at a special Senate Economic Legislation Committee hearing.
AIST CEO Tom Garcia said AIST would argue the LISC was a major equity measure in the super system that reflected Australia's changing work patterns of increased part-time and casual employment.
"LISC provides more equitable arrangements for over 30 per cent of the total Australian workforce and 50 per cent of the Australian female workforce," Garcia said.
"Forty years ago, around one in 10 employees worked part time. Now over a quarter of Australian workers work part time and many of these workers qualify for LISC," Garcia said.
The LISC scheme provides up to $500 a year in superannuation for those earning less than $37,000 a year, benefitting 3.6 million Australians, out of which 2.1 million are women.
AIST's submission to the Senate will argue the LISC scheme righted a wrong on a tax anomaly in the super system where low income earners were paying more tax on their super than their take home pay.
"Low income and part-time earners are entitled to a tax benefit on their compulsory super contributions just like the other two thirds of working Australians," Garcia said.
AIST urged the Abbott Government earlier this month not to abolish the former Labor Government's LISC.
Garcia said LISC was one of the best policy measures since compulsory superannuation was brought in, adding more than four times as many Australians benefited from it than the co-contribution scheme.
Members of Women in Super recently wrote an open letter to Prime Minister Tony Abbott urging his Government to continue the LISC, arguing those who earn $37,000 or below per annum will stop receiving a $500 rebate of the tax paid on their super, which will hurt them.
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