POWERED BY MOMENTUM MEDIA
Get the facts right on super concessions: ASFA
The Association of Superannuation Funds of Australia (ASFA) is calling on media to “get the facts right” after news outlets reported tax concessions on super would cost the Australian Budget up to $32 billion this year.
ASFA chief Pauline Vamos said that while there had to be debate on how to cope with an ageing population that was living longer with higher expectations, it had to be conducted in the context of accurate figures regarding the concessions.
“Analysing the tax concessions applied to super is not as simple as just looking at the Tax Expenditure Statement,” Vamos said.
“It’s important that all relevant factors are taken into account, to generate a more accurate picture of the incentives the Government provides to help people save for their retirement. The bottom line is the system is sustainable for the medium term so there is time to have a measured and informed debate.”
This includes the consideration that the Government currently saves $7 billion annually in age pension costs due to super.
The comments follow media reports that superannuation concessions such as investment earnings - including capital gains - are exempt from tax if they are from assets supporting superannuation pensions, meaning the Government forgoes $32.1 billion in revenue.
Deloitte-Access Economics’ Chris Richardson argues the wealthy would gain the most out of such concessions.
He said while superannuation concessions were needed, they were inequitable and needed reviewing.
Vamos also said savings that are not put into super could end up going into other tax-advantaged areas such as negative gearing, which reduces the final tax savings created for the Government.
After taking this into consideration, the community’s final tax concessions on super in fact dropped to about $16 billion, she said.
“The policy focus should be on closing the gaps in the system, and ensuring that governments provide appropriate incentives for people to save for their retirement across all income brackets.”
Recommended for you
Jim Chalmers has defended changes to the Future Fund’s mandate, referring to himself as a “big supporter” of the sovereign wealth fund, amid fierce opposition from the Coalition, which has pledged to reverse any changes if it wins next year’s election.
In a new review of the country’s largest fund, a research house says it’s well placed to deliver attractive returns despite challenges.
Chant West analysis suggests super could be well placed to deliver a double-digit result by the end of the calendar year.
Specific valuation decisions made by the $88 billion fund at the beginning of the pandemic were “not adequate for the deteriorating market conditions”, according to the prudential regulator.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.56 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.06 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
26.81 3 y p.a(%)
