Two of the federal government’s three superannuation bills have been passed by the House of Representatives and the Senate unamended.
The Superannuation (Excess Transfer Balance Tax) Bill 2016 and Treasury Laws Amendment (Fair and Sustainable Superannuation) Bill 2016 were rubber-stamped in a report from the Senate Economics Legislation Committee, and then subsequently passed by both houses of Parliament.
In a joint statement, Treasurer Scott Morrison and Revenue and Financial Services Minister Kelly O’Dwyer said the government had secured parliamentary passage for the most comprehensive suite of super reforms in a decade, delivering on its commitment to improve the fairness, sustainability, flexibility and integrity of the superannuation system.
“The superannuation reform package better targets tax concessions to make our superannuation system fair and sustainable as the population ages and fiscal pressures increase,” Morrison and O’Dwyer said.
“The reforms include the introduction of a $1.6 million transfer balance cap, which places a limit on the amount an individual can transfer into the tax-free earnings retirement phase, and the introduction of the Low Income Superannuation Tax Offset, which is expected to boost the retirement incomes of around 3.1 million low-income earners.
“The passage [of the two bills] will improve the underlying cash balance by $2.8 billion over the forward estimates.”
The Superannuation (Objective) Bill, which will enshrine the objective of superannuation in legislation, is being considered by the Senate Economics Legislation Committee, which is due to report back on 14 February 2017.
SMSF Owners’ Alliance executive director Duncan Fairweather said the controversial changes, which included some 142 pages of complex new tax law and 364 pages of explanation, were simply waved through Parliament.
“The [Senate Economics Legislation] Committee acknowledged concerns from the superannuation sector that the legislation is complex and will be difficult to apply in practice, but was satisfied the government had allowed for this in its ‘extensive policy development and consultation process’,” Fairweather noted.
“In reality, the consultation process was rushed at every stage with only a few days allowed for public comment on the draft bills.
“The legislation passed today is basically about raising revenue and the Parliament will not be considering the overarching legislation on the objective of superannuation until next year.”
SMSF Association chief Andrea Slattery strongly advised SMSF trustees and members that their first point of call should be their financial adviser or accountant.