News

ATO, Business news

Industry body calls for sensible tax talks

The SMSF Association has called for the government and industry to have informed dialogue about superannuation tax concessions without reliance on flawed measures like the Treasury Tax Expenditures Statement (TES) as justification to make changes to the system.

“Critics often cite the TES measurement to bolster their arguments that tax concessions are fiscally unsustainable. In the association’s opinion, this ignores the nature of the TES measurements of the concessions [which] have … unrealistic assumptions,” SMSF Association chief executive Andrea Slattery said.

Treasury compiles the TES annually to measure concessions in the tax system, although it is not designed to serve any budgetary or policy purpose.

In addition, the SMSF Association pointed out people relying on the TES to form an argument around superannuation tax concession changes should be aware the measurements used did not consider behavioural change, they were compared against a comprehensive income benchmark that assessed tax concessions against an idealised tax system, and separate tax concession measures were not additive.

“Some have suggested simply because there is a large measured expenditure, government should necessarily do something about it. That is not the case. There is no policy message in the TES,” Slattery said.

She highlighted the fact the TES ignored savings the government made through reduced reliance on the age pension due to increased superannuation contributions made as a result of the current tax concessions in place.

“Excluding the future savings to government expenditure on the age pension results in a myopic and overly simplistic analysis of the true costs of the superannuation tax concessions,” she said.

She added the association was looking forward to participating in the Intergenerational Report and tax white paper consultation processes to help ensure people had greater confidence in the system.

“Currently we are seeing a misinformed, simplistic and distorted debate about the tax concessions, and the future of the superannuation system and Australians’ retirement is too important for this to continue,” she said.

Our Story

selfmanagedsuper is the definitive publication covering Australia’s SMSF sector. It uniquely offers both online and print publications tailored separately for SMSF professionals and individual trustees participating in the fastest growing and largest sector of the superannuation industry. As such, it is a must read for those wanting to stay informed about the latest news, regulatory developments, technical strategies, investments, compliance, legal and administration issues concerning SMSFs.

Copyright © SMS Trustee News 2019

ABN 43 564 725 109

Benchmark Media

Site design Red Cloud Digital