Mining tax earnings, which are supposed to pay for the increase in the superannuation guarantee, are way down, raising only $126m in the first six months. In the budget, it was forecast to make $2bn during 2012-13.
Talking to Fran Kelly on ABC, Treasurer Wayne Swan admitted that revenue was down, not only from Mining tax but also from superannuation. He refused to rule out increasing taxes on either income tax or super, but later in the day he issued a statement ruling out an increase to income tax. So what does this mean for superannuation contributors?
Shorten reassured Kelly that in terms of paying for superannuation changes, they had factored it into their budget papers and Mid-Year Economic and Fiscal Outlook (MYEFO). When asked directly if they were going to increase the superannuation tax paid by wealthy Australians, Shorten dodged the question: “Fran, we will be able to pay for this. We have a policy - we've already introduced the tax cut. We've done it from the first of July last year we've introduced that tax cut.” He then changed the topic to the Liberals’ suggested tax on the 3.6 million low-income earners.
Shadow Treasurer Joe Hockey declared the government’s budget was in “total chaos”, with no policy direction, when he spoke to reporters in Canberra yesterday.
He said the government was “creating uncertainty for businesses and consumers with its attack on various aspects on the au sec such as super and such as household income through personal income tax”.
“At the end of the day everyone’s just wondering how much extra tax the Government’s going to take from their pocket.”
AFA CEO Brad Fox said the constant changes proposed by political parties were causing consumers to lose faith and confidence in super as a way of investing for their retirement.
"when we're battling changes in rules and needing to change processes within our businesses, which is very expensive to do, and at the same time you've got the consumer questioning whether or not they can trust the system, it's like burning the candle at both ends. The wick's getting taken away far too fast."
Noting that other sectors of the superannuation industry had already voiced their opposition to any changes in the Budget, SPAA CEO Andrea Slattery used the occasion of the association’s 10th anniversary gala dinner to urge all members to voice their opposition to suggestions that tax concessions to superannuation will be pared back.
“We want our members to be talking to their trustee clients, to continually update them on what’s being discussed, so as to develop a strong, collective voice to retain superannuation as the main savings vehicle for Australians in retirement.
“Let’s not forget the SMSF sector represents nearly one million trustees. Or, put another way, nearly one million voters.”
Shorten declined a request for a thirty minute interview with Wealth Professional within the next eight weeks. Are you concerned that the Government sees your clients' super as a way to boost their revenue gap?