Government releases draft exposure on CGT relief
The Minister for Financial Services and Superannuation, Bill Shorten, has released exposure draft legislation on income tax relief for merging super funds for comment.
The draft suggests backdating the relief to apply from 1 October 2011, extending relief to all revenue assets regardless of the net position of the entity, and removing the 12-month integrity rule.
Association of Superannuation Funds of Australia (ASFA) president Pauline Vamos said the changes respond to concerns ASFA had about the impact of capital gains tax (CGT) on fund members.
"We are pleased to see that relief is likely to cover the period from 1 October 2011 onwards and that the Government has acknowledged the concerns we raised about integrity measures," she said.
Vamos said without CGT relief, merging fund members could suffer tax-related losses of up to 2 per cent or funds may choose not to merge, which would lead to higher costs and less benefits for members.
ASFA has consistently lobbied the Government for permanent CGT relief (although at a minimum) and have recommended relief is granted throughout the Stronger Super reform period.
ASFA is yet to examine the exposure in detail and will respond with a submission in due course, Vamos said.
Submissions on the draft exposure close on 24 August 2012.
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