Sharon Bird and Stephen Jones today welcomed Labor’s policy announcement of two key measures to ensure that Australia’s retirement savings system is fair and sustainable into the future.
The changes will see $14.3 billion in savings over 10 years – this is good for fairness and good for the Budget.
The first change to superannuation will see earnings over $75,000 taxed at a concessional rate of 14 per cent in the retirement phase, instead of being tax free.
The current tax-free status of all superannuation earnings disproportionally benefits high income earners and is unsustainable.
Secondly, Labor will lower the threshold on the High Income Superannuation Charge from $300,000 to $250,000 a year. This measure will better align tax concessions received by those on very high incomes with those on average incomes and will save an estimated $5.1 billion over 10 years.
“These changes show how Labor will responsibly manage the Budget without stifling economic growth or cutting funding to the people most in need in our community – pensioners, students and the sick,” Sharon Bird said.
“Tony Abbott and Joe Hockey want to cut billions of dollars from pensioners, health and education – Labor is focussed on ensuring savings measures are fair and don’t hit the most vulnerable.”
“Together with Labor’s crackdown on multinational tax minimisation, these changes will return more than $20 billion to the Budget over the decade,” Stephen Jones said.
“These are the only changes that Labor will make to the tax treatment of superannuation if we are elected.”
Labor’s plan to make Australia’s retirement savings system fair and sustainable has been fully costed by the independent Parliamentary Budget Office.