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The announcement that two of the superannuation reform bills have passed through both houses of government has received mixed views from those in the industry.
The Treasury Laws Amendment (Fair and Sustainable Superannuation) Bill 2016 and the Superannuation (Excess Transfer Balance Tax) Imposition Bill 2016 were passed by both houses today.
The Association of Superannuation Funds of Australia (ASFA) welcomed the passing of the legislation stating that it would address issues of equity and sustainability in Australia’s retirement income system.
ASFA chief executive Martin Fahy said that ASFA supported having a ceiling on the amount of superannuation that is tax free in retirement and that the “policy has landed in the right spot”.
Dr Fahy said the establishment of the Low Income Superannuation Tax Offset (LISTO) is important to provide incentive for low income earners to save for their retirement.
“The greater flexibility in the system that the package will provide, including allowing people to make catch up concessional contributions, is a particular positive because it gives women who spend time out of the work force the opportunity to make greater contributions,” he said.
Other groups such as the SMSF Owners’ Alliance said there was not enough debate on the issues and that the changes have “simply been waved through”.
“In reality, the consultation process was rushed at every stage with only a few days allowed for public comment on the draft bills,” said SMSFOA executive director Duncan Fairweather.
“The legislation passed today is basically about raising revenue.”
Mr Fairweather said with the over-arching legislation on the objective of superannuation delayed till next year, the government has “put the cart before the horse”.
“The challenge now for the trustees of half a million SMSF members is to understand how the complex new tax laws will affect them and make decisions on how to manage their superannuation assets well before 1 July next year,” he said.