Tweed expert backs super review
A TWEED financial planner has said Australians would be better off under the Henry tax review’s changes to superannuation.
The government’s response to the independent review was to increase the compulsory superannuation contribution from nine to 12 per cent by 2019 - a change Tweed Heads AMP financial planner Wendy Scarlett said would benefit millions of Australians.
These proposals, however, hinges on resource companies and the states agreeing to a new way of taxing miners - a 40 per cent Resource Super Profits Tax.
“Most Australians are very much under-funded for their retirement,” Mrs Scarlett said.
“So any increases that people are allowed to make will be a great thing for Australia as a whole.”
Mrs Scarlett said the change would not only benefit people but lessen the strain on the social security system.
“Previously the government had cut back what people could put in as a contribution. It’s great they’re increasing that limit.”
She added the global financial crisis highlighted for many people that they would not have enough money to retire on.
“A lot of people went back to work or worked longer,” Mrs Scarlett said.
“Now they will be able to build up their superannuation fund.”
The Henry tax review finally saw the light of day yesterday after four months of consideration by Treasurer Wayne Swan.
There weren’t the sweeping changes that had widely been speculated, but, as well as superannuation, corporate tax and small business all received a positive shake-up in the federal government’s first wave of tax reform.
Mr Swan said the government’s response to the review was an “ambitious challenge for long-term reform”.
“It will ensure all Australians get a fairer share of the (resources) boom.”
The impact of these entire measures will add 0.7 per cent to economic growth over the long run and lift wages by 1.1 per cent, or the equivalent of $450 per year for the average paid worker.
Opposition Leader Tony Abbott described the minor changes to the tax system as a tax grab rather than reform, saying Prime Minister Kevin Rudd had accepted just two and a half of 138 recommendations put forward by the review.
Mr Swan said he would make further announcements, but ruled out several recommendations made by Treasury Secretary Ken Henry’s review team.