Superannuation Rate News
Scott Morrison and Malcolm Turnbull are seriously considering scrapping the planned superannuation rate rise to 10%, which is due in July 2018. The compulsory super rates are currently scheduled to rise by 0.5% every July 1st from 2018 to 2022; which would see that rate reach 12%. The ALP if elected would like to bring that forward to 2015 to 2019. Employers are lobbying the government to delay this rise in superannuation rates until 2021 to 2025. They claim it adds $20 billion a year to their wages bills. The move would save the government billions of dollars in their federal budget.
The Turnbull government is looking for ways and funds to create potentially election winning income tax cuts. Cancelling the scheduled compulsory superannuation rate rises would go a long way to achieving that. Prime Minister Turnbull has not committed to anything at this stage but it looks like the GST increase is off the agenda. Also related to superannuation rate news, the Treasury has explored removing tax concessions on superannuation as another means of recouping billions of dollars from the next budget. The PM stated later that his government had no firm plans to alter the rise schedule in compulsory superannuation. A lack of announced economic policies seems to be a fair criticism of this government; especially in an election year.
The next three months before the budget will see a lot of debate between coalition ministers and the PM over which economic mix to take into the coming election. Scott Morrison is rumoured to be in favour of a GST increase, as the most effective way to fund tax income cuts for workers. Mr Turnbull, apparently, is not so sure and political commentators have pointed to the ALP’s strong anti-GST increase as a potentially election winning issue. Changes to super are seen as less divisive at the polling booth.
The government’s economic analysis of the proposed superannuation rate rises sees Australian workers on medium to low wages reaping little reward from the compulsory contributions to super, which lowers their take-home pay today and does not guarantee that they will be in a position to not need the Age Pension at retirement. Although, the Treasurer, Mr Morrison, later claimed that the existing 9.5% levy creates around 80% of what a retiree would require to live on for someone earning around $52 thousand dollars a year. Bigger take-home salaries today may be better for a sluggish Australian economy, putting more money into it and, perhaps, stimulating retail sales and growth.
Superannuation rate 1,900
Superannuation Australia 390
Superannuation changes 110
Superannuation rate Australia 70