Morrison signals direction of super tax changes
The Federal Treasurer, Scott Morrison has sent his clearest signal yet that the Government is intent on altering the tax structures around superannuation to eliminate their use as "tax free inheritance pools".
At the same time as confirming his view the purpose of superannuation has to be ensuring people become less reliant on the age pension, the Treasurer said he was particularly concerned to look after the needs of low and middle income earners.
Speaking during a national television interview, Morrison said the Government believed that the purpose of superannuation, by definition the purpose of any tax incentives supporting superannuation was to "ensure that people would be less reliant, or not reliant at all, on a welfare payment, i.e. the pension, in their retirement".
"Now, there are a whole range of people for whom the landing on the pension is not a reality for them. But they're particularly low and middle income-earners, and in particular those most at risk, if they're not building up their superannuation over time - they're the ones who are most likely to be drawing down heavily on a welfare payment in the pension in the future," the Treasurer said.
"So our argument on super is we've got to ensure the incentives are targeted to address the purpose and are not there as the form of building inheritance pools or tax free inheritance pools to pass on," he said. "That's not what super's about."
However he rules out suggestions of retrospectively legislating to impact those already in the retirement phase.
"On the retirement phase, though, I think we always have to be very careful on the retirement phase because people are in it," Morrison said. "They set up their arrangements before going into it and whether it's technical retrospectivity or not, you are effectively applying a retrospectivity when you're looking at the retirement phase."
Recommended for you
The Reserve Bank of Australia's latest interest rate announcement has left punters disheartened on Melbourne Cup Day.
Equity Trustees has been selected as the responsible entity for two new funds, one from Coller Capital focused on private equity and a second investing in fixed income from FIIG Securities.
Funds managers are being urged by financial advisers to improve their “outdated” education and communication about alternative funds as they actively target them towards retail clients.
GAM Investments has appointed Eric Finnell as its managing director for Australia after his predecessor left to take up the CEO role at Global X.
