Abbott to up super tax on battlers.     :(

    JESSICA IRVINE - NATIONAL ECONOMICS EDITOR
    News Limited Network
    February 01, 2013


The Coalition plans to cut a $1 billion superannuation tax break for low-income earners. Source: Supplied

SUPERANNUATION has emerged as an election issue, after Opposition leader Tony Abbott confirmed plans to axe a super tax break worth up to $500 a year for 3.6 million low-income earners.     :(

Meanwhile, Labor is running the ruler over the nest eggs of high-income earners in its search for budget savings.

Treasury forecasts, released yesterday, predict the total value of super tax breaks will grow to $45 billion by 2015-16, up from $30 billion last financial year, surpassing the cost of the aged pension.

This is despite the Gillard government already tightening the screws on superannuation, reducing the concessional contributions caps from $50,000 and $100,000 to $25,000.

Mr Abbott yesterday pledged there would be "no unexpected changes that are detrimental to people's superannuation" if he becomes prime minister, but he confirmed a previous announcement that a Coalition government would axe $1 billion a year in super concessions for low-income earners, funded by the mining tax the Coalition also plans to scrap.

Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that. However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower.

Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers.

Superannuation Minister Bill Shorten accused Tony Abbott of blackflipping on his commitment to make no changes to the superannuation system.     :(

"The re-imposition of a $1 billion per year tax on 3.6 million Australians is an unexpected and dramatic change by any assessment," he said.

Opposition superannuation spokesman Mathias Cormann said Labor had a track record of targeting superannuation for budget savings.

"Every time Labor increases taxes on Australian super savers, they reduce the incentive for them to do the right thing by saving towards achieving a self-funded retirement," he said.

A spokesman for the Treasurer would not comment on potential budget savings.

"Labor invented superannuation because we fundamentally believe that hard-working Australians deserve a dignified retirement income. We have shown in the past that we are willing to make improvements to superannuation that make the system stronger and fairer," he said.

Hi Crook,
the poor Newstart people will all vote Green.

At least the Greens will control the senate so don't worry too much.

Everything will be alright.

It is linked to the mining tax. The mining tax and whatever is linked to it will go.

Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity.

super always represented too big a target for both sides.
whilst pollies super is fairly safe, the temptation to raid the piggy bank by both labor and liberal is one reason i feel super was always a bad idea.

still the tax breaks WERE so good you had to be in it.
i just wouldnt make any long term plans about retiring on it ;) ;)

Superannuation is an elitist pyramid scheme that is not the struggle of the battlers.   Social security and justice is our fight.  I will not be archiving this as I see it as progressive and an enlightened measure... :)

It would be cheaper to axe all tax concessions for super and give all retirees the pension.....Fact!!!

>:( >:( >:(

progressiveslol wrote on Feb 1^st, 2013 at 6:48am:

It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity.

You idiot the co contribution scheme has been in since Howard.


Quote:

Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund.

The first party that scraps all these tax loop holes and gets rid of all middle and upper class welfare will get my vote.
We need to scrap all of Howards old election bribes because we cannot afford it.
I would even vote for Phony Tony if he pledges to get rid of all of this wasteful welfare.

No surprise it is the Liberal way, take from the poor to give to the rich.

It's just their reverse robin hood mentality, elect the conservatives and that is what you get and that is what you deserve it's no big secret.

Dsmithy70 wrote on Feb 1^st, 2013 at 7:48am:

progressiveslol wrote on Feb 1st, 2013 at 6:48am: It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity. You idiot the co contribution scheme has been in since Howard. Quote: Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund.

Wow you are a real idiot arent you

Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers.

progressiveslol wrote on Feb 1^st, 2013 at 9:31am:

Dsmithy70 wrote on Feb 1st, 2013 at 7:48am: progressiveslol wrote on Feb 1st, 2013 at 6:48am: It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity. You idiot the co contribution scheme has been in since Howard. Quote: Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund. Wow you are a real idiot arent you Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers.

Ok fair enough I'll cop that.

Got my co contributions mixed up, why the f#@!k we need more than one is beyond me.

Dsmithy70 wrote on Feb 1^st, 2013 at 9:47am:

progressiveslol wrote on Feb 1st, 2013 at 9:31am: Dsmithy70 wrote on Feb 1st, 2013 at 7:48am: progressiveslol wrote on Feb 1st, 2013 at 6:48am: It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity. You idiot the co contribution scheme has been in since Howard. Quote: Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund. Wow you are a real idiot arent you Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers. Ok fair enough I'll cop that. Got my co contributions mixed up, why the f#@!k we need more than one is beyond me.

And this is an important issue..there are so many govt handouts that everything should be scrapped and just the basics like old aged pensions and short term unemployment benefits kept.
Imagine how much money the average Aussie would have in their own pockets to spend on goods and services of their own choice if 90% of govt handouts were scrapped.

Dsmithy70 wrote on Feb 1^st, 2013 at 9:47am:

progressiveslol wrote on Feb 1st, 2013 at 9:31am: Dsmithy70 wrote on Feb 1st, 2013 at 7:48am: progressiveslol wrote on Feb 1st, 2013 at 6:48am: It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity. You idiot the co contribution scheme has been in since Howard. Quote: Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund. Wow you are a real idiot arent you Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers. Ok fair enough I'll cop that. Got my co contributions mixed up, why the f#@!k we need more than one is beyond me.

why the f#@!k we need more than one is beyond me

It isn't two this one helps people on low incomes who get very little or no benifit from the other one. The previous existing scheme allows people in the highest tax bracket to be paying 15 cents in the dollar tax on contributions.

Dnarever wrote on Feb 1^st, 2013 at 10:10am:

Dsmithy70 wrote on Feb 1st, 2013 at 9:47am: progressiveslol wrote on Feb 1st, 2013 at 9:31am: Dsmithy70 wrote on Feb 1st, 2013 at 7:48am: progressiveslol wrote on Feb 1st, 2013 at 6:48am: It is linked to the mining tax. The mining tax and whatever is linked to it will go. Good policy as the mining tax does not earn money. So under labor we have to borrow more in order to pay for labors stupidity. You idiot the co contribution scheme has been in since Howard. Quote: Since 1 July 2003, the Government has made available incentives of a Government co-contribution of up to $1,500 for lower income employees who make personal contributions to their own superannuation fund. Wow you are a real idiot arent you Labor's Low Income Superannuation Contribution scheme, announced in the May 2010 budget as part of the mining tax package and payable from last June, is worth up to $500 a year to eligible workers. Ok fair enough I'll cop that. Got my co contributions mixed up, why the f#@!k we need more than one is beyond me. why the f#@!k we need more than one is beyond me It isn't two this one helps people on low incomes who get very little or no benifit from the other one. The previous existing scheme allows people in the highest tax bracket to be paying 15 cents in the dollar tax on contributions.

All you have to do to get Howards is contribute $1000 of your own money, $20 p/week & the government,depending on your income will contribute up to $30($1500).

This one seems to be based on tax brackets.
Low income earners are already paying 15% or less taxation as per article


wrote on Feb 1^st, 2013 at 6:42am:

Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that. However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower.

Their benefit would have been the $1500 from the original scheme.

The only thing tempering me from going to town completely on Labor is the alternative.

Vote GREEN to stop him.

Bobby. wrote on Feb 1^st, 2013 at 12:56pm:

Vote GREEN to stop him.

The party that wants to remove the employee fringe benefits and increase our taxes.

Yeah tremendous idea that....

Andrei.Hicks wrote on Feb 1^st, 2013 at 2:39pm:

Bobby. wrote on Feb 1st, 2013 at 12:56pm: Vote GREEN to stop him. The party that wants to remove the employee fringe benefits and increase our taxes. Yeah tremendous idea that....

Hi Andrei,
remember to vote Green to protect your rights if ever you find yourself unemployed.


I am predicting the Greens will hold the balance of power in the Senate again
as all social welfare recipients will vote for them.

Vote Green to protect your rights & save the planet.

Dsmithy70 wrote on Feb 1^st, 2013 at 11:56am:

All you have to do to get Howards is contribute $1000 of your own money, $20 p/week & the government,depending on your income will contribute up to $30($1500). This one seems to be based on tax brackets. Low income earners are already paying 15% or less taxation as per article wrote on Feb 1st, 2013 at 6:42am: Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that. However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower. Their benefit would have been the $1500 from the original scheme. The only thing tempering me from going to town completely on Labor is the alternative.

All you have to do to get Howards is contribute $1000 of your own money

Most of the working poor do not have a spare $1,000.

This benifit does not typically go to the people at the lowest margins.

Yes it is there but for most it is meaningless.

Dnarever wrote on Feb 2^nd, 2013 at 12:43pm:

Dsmithy70 wrote on Feb 1st, 2013 at 11:56am: All you have to do to get Howards is contribute $1000 of your own money, $20 p/week & the government,depending on your income will contribute up to $30($1500). This one seems to be based on tax brackets. Low income earners are already paying 15% or less taxation as per article wrote on Feb 1st, 2013 at 6:42am: Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that. However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower. Their benefit would have been the $1500 from the original scheme. The only thing tempering me from going to town completely on Labor is the alternative. All you have to do to get Howards is contribute $1000 of your own money Most of the working poor do not have a spare $1,000. This benifit does not typically go to the people at the lowest margins. Yes it is there but for most it is meaningless.

Very few of us have a spare $1,000 these days with the current cost of living!!

philperth2010 wrote on Feb 1^st, 2013 at 7:41am:

It would be cheaper to axe all tax concessions for super and give all retirees the pension.....Fact!!! >:( >:( >:(

not sure this would hold if we projected this into the future.

Dnarever wrote on Feb 2^nd, 2013 at 12:43pm:

Dsmithy70 wrote on Feb 1st, 2013 at 11:56am: All you have to do to get Howards is contribute $1000 of your own money, $20 p/week & the government,depending on your income will contribute up to $30($1500). This one seems to be based on tax brackets. Low income earners are already paying 15% or less taxation as per article wrote on Feb 1st, 2013 at 6:42am: Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that. However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower. Their benefit would have been the $1500 from the original scheme. The only thing tempering me from going to town completely on Labor is the alternative. All you have to do to get Howards is contribute $1000 of your own money Most of the working poor do not have a spare $1,000. This benifit does not typically go to the people at the lowest margins. Yes it is there but for most it is meaningless.

Maybe I'm not understanding, I haven't heard of the scheme really before now.


Quote:

Contributions to super are taxed at a flat rate of 15 per cent. High-income earners benefit because they would usually pay more tax than that.

So my reading of this is that high incomer earners get the tax benefit by sacrificing part of their disposible income into super.
That income is only taxed at the rate of 15%


Quote:

However, workers on less than $37,000 previously got no benefit from contributing to super because their tax rate is already 15 per cent, or lower.

So because as we know and as pointed out low income earners don't have diposible income, its reads as if the government just gave them $500.

Now thats very noble but it will eventually blow out as reported it already is by 50% on last finanical year.


Quote:

Treasury forecasts, released yesterday, predict the total value of super tax breaks will grow to $45 billion by 2015-16, up from $30 billion last financial year, surpassing the cost of the aged pension.

a couple of alternatives that come to mind are reducing the  co contribution to the original scheme to maybe $500-700 or increasing the super employer contribution to the original goal of 12%.

Perhaps that is the labor/liberals answer to the penalty rate question bubbling away at the moment, they are gone but supers up.

Either of these 2 would benefit low income super nest eggs better in the longer term .

Bobby. wrote on Feb 1^st, 2013 at 12:56pm:

Vote GREEN to stop him.

No Bobbythebat we are never going to vote for the extreme Greens no matter how bad the major parties are...but you can rest assured that we are watching the Greens... :)