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Superannuation needs reform says ACOSS
SUPERANNUATION tax concessions must be reformed to reduce inequality and ensure government assistance is targeted to those who need it the most, according to the Australian Council of Social Service (ACOSS).
With one in eight people in Australia living in poverty and the cost of living crisis continuing to bite, the Federal Government is right to scrutinise unaffordable, unfair tax breaks for the wealthiest in our society, ACOSS CEO Cassandra Goldie said.
She said superannuation concessions "cost the community an eye-watering $52 billion a year -- money that could be used to reduce poverty and fund essential public services such as health and aged care".
Ms Goldie welcomed the Treasurer’s move to legislate an objective for superannuation to make sure the system is equitable and sustainable.
“The Treasurer is absolutely right to be concerned about the ballooning cost and inequity of tax breaks for superannuation, which do not benefit people on the lowest incomes,” she said.
“The system has become a tax avoidance scheme that allows people who are already very well off, who are mostly men, to build up huge balances that are more than enough for a decent retirement and often passed on to adult children.
“Today at the Senate Inquiry into poverty, I urged the government to do more to assist the millions of people who are struggling to afford the essentials of life such as rent, food, energy and medicines.
“To provide a fair and inclusive society we must make the right choices about who needs more government help and who needs less. Scrutinising unfair super tax breaks is a useful place to start.”
ACOSS presented what it called 'key facts' at the hearing that summed up the situation today:
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Superannuation tax concessions cost the Budget $52 billion a year, almost the cost of the Age Pension ($55 billion);
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Most of the benefit of superannuation tax breaks goes to the highest 20 percent of people by income; and
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Once a fund member retires, the investment income of their account is completely tax free. This is not sustainable when governments are already struggling with the costs of quality health and aged care.
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