Government to water down proposed changes to super
It’s no secret superannuation was one of the big talking points of the 2016 Federal Election, after the Government proposed a series of changes in the 2016 Federal Budget.
But if recent reports are anything to go by, many of the changes initially flagged by the Government stand to be watered down before they are officially implemented.
Speaking in an interview on Macquarie Radio, Federal Treasurer confirmed as much, suggesting that the while the proposed lifetime cap on top-up contributions of $500,000 would stand to remain, the Government was willing to write in exemptions that would be specifically designed to help people who were struggling with major life events.
Morrison said, “One of them, if you get a pay-out as a result of an accident or something like that, then that is exempted from the $500,000 cap. If you have entered into a contract before budget night to settle on a property asset out of your self-managed super fund and you are using after-tax contributions to settle that contract – well, that won't be included.”
In the same interview, Morrison noted it’s not likely they will lift the $500,000 cap.
Morrison said, “I don't know too many people out there who are sitting there with a bag of $500,000, which they want to put in their superannuation fund. They are on higher incomes, have higher balances, have already benefited significantly from the generous tax contribution and other concessions, and the argument they are making is: 'I want to put more in so I don't have to pay as much tax as someone else is on those earnings'.”
Not everybody is happy with this move, however.
The Council of Ageing’s chief executive, Ian Yates, argues watering down changes would be caving in to “the complaints of a privileged minority”.
Yates said that the outcry in the lead up to the election had, “Given air to the complaints of a privileged minority created space during the campaign for Labor to ‘dog whistle’ a so-called threat to super; while later banking the whole of the savings from the super reforms.”
What do you make of these super changes? Do you think enough has been done to engage retirees in these decisions? Share your thoughts in the comments.
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