SMSF trustees need appropriate tax treatment
Any Government review of the Australian taxation system needs to take account of the fact that Self Managed Superannuation Fund (SMSF) trustees are the least likely to look to taxpayers for support in retirement.
That is the analysis of the Self Managed Super Fund Professionals' Association (SPAA) in the wake of the recent tax summit, with chief executive Andrea Slattery saying the Government needs to take account of the SMSF trustee demographic and ensure any changes encourage the community to reduce reliance on government support in retirement.
"In particular, any proposed tax changes should be tested against whether they might act as a disincentive to save for retirement," she said.
Responding to the issues discussed at the tax forum, SPAA called for an increase in the annual concessional superannuation caps and a long-term solution to excess contributions tax.
"In SPAA's view, the current, excessively low concessional contribution cap represents a significant barrier to voluntary savings under pillar three of our three-pillared retirement income system," Slattery said.
"We acknowledge the budgetary cost of increasing the standard concessional contribution cap by $10,000 to $35,000 for those over age 50; however we believe the cost to revenue would be partially offset by the cost-savings of not increasing the cap to $50,000 for those with $500,000 or less in super," she said.
Slattery also pointed to ATO figures showing that more than $300 million in excess contributions tax had been collected since 1 July, 2007, and said the severity and manner in which the tax was imposed was one of the most significant issues impacting consumer confidence in the superannuation sector.
AUTHOR
Mike Taylor
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