Treasurer thrusts super concessions firmly into tax debate


Income tax has become the silent tax for many Australians, particularly young Australians, according to Federal Treasurer, Scott Morrison.
In a seminal speech delivered to a conference in Melbourne today, the Treasurer put tax reform squarely on the table including the lifting of the goods and service tax (GST), and the structure of tax concessions granted to superannuation.
However, front and centre in Morrison's address was the drag to the economy being created by the current personal tax regime.
He said that around 300,000 Australians were expected to move into the second highest tax bracket over the next two years and that if there were no tax cuts for 10 years, nearly half of all taxpayers would be in the top two tax brackets — an increase from around 27 per cent today to 43 per cent in 10 years.
"This means that next year the average wage earner will be taxed up to 37 cents in the dollar on what they earn, but on less than half of every dollar they spend, they will pay only 10 cents in tax through the GST," the Treasurer said.
"To achieve a better a tax system, Australia needs to carefully consider the impact of income tax, especially personal income tax, on economic growth, and living standards," Morrison said.
He said these were not the only items on the table for discussion and cited other areas such as "generous superannuation concessions".
Morrison also pointed a finger at the states saying that state taxes and charges could not be quarantined from the tax debate.
Recommended for you
A financial advice firm has been penalised $11 million in the Federal Court for providing ‘cookie cutter advice’ to its clients and breaching conflicted remuneration rules.
Insignia Financial has experienced total quarterly net outflows of $1.8 billion as a result of client rebalancing, while its multi-asset flows halved from the prior quarter.
Prime Financial is looking to shed its “sleeping giant” reputation with larger M&A transactions going forward, having agreed to acquire research firm Lincoln Indicators.
An affiliate of Pinnacle Investment Management has expanded its reach with a London office as the fund manager seeks to grow its overseas distribution into the UK and Europe.