Super tax increases does not fix the budget…

The Gratton Institute has done the leg work for us and it shows that you cannot fix the Federal Budget by taxing super.

Their proposals are far reaching… but hardly raise enough revenue each year to cover just the increase, not the actual cost, in spending programs like the NDIS.

Idea 1: removing tax concessions for super balances above $2m. you get 15% or 0% on the earnings of the first $2 million you have in super. Any earnings on assets in super above the first $2 million of assets are taxed in your tax return at your tax rate (and you can take out of super any assets above $2 million). Wow. but what does it say each year? A whopping $1.5bn a year.

Idea 2: Increasing the additional tax on super contributions for individuals whose combined income and contributions are greater than $250,000 from 30 per cent to 35 per cent, and lowering that income threshold to $200,000. This would make an investment trust with a bucket company a lower taxed vehicle than super in many cases… Wow. but what does it say each year? A whopping $1.1bn.

Idea 3: Lower the cap on annual concessional super contributions from $27,500 to $20,000. Earn $160,000 and 12% super would use all your deductible super. Wow. but what does it say each year? a whopping $1.6bn each year

Do all this, smash super, and raise $4.2bn.


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