The Federal Government has been urged to use the upcoming Federal Budget to change the rules around superannuation to make it more attractive for low-income earnings via a contributions tax rebate.
In a pre-Budget submission filed with the Federal Treasury this week, the Association of Superannuation Funds of Australia (ASFA) argued that, currently, there is no tax advantage for those earning less than $35,000 a year for employer or salary sacrifice contributions.
ASFA chief executive Pauline Vamos said that if a contributions tax rebate was given to someone earning $30,000 a year, their retirement savings would go from $145,000 to $171,000 over 35 years.
She said that ASFA had estimated the annual cost to the Budget would be around $600 million a year and benefit around two million workers at the same time as lower expenditure on the age pension.
The ASFA submission also recommended that middle-income earners be assisted by a partial rebate of contributions tax or an enhancement of the existing superannuation co-contributions regime.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
A member of the super fund has approached ASIC to investigate potentially misleading or deceptive representations by UniSuper regarding the holdings of its sustainable portfolios.
The median growth fund delivered 1.9 per cent in March, adding to the “stunning” rally that has seen super funds gain 11 per cent since November.
Vanguard has affirmed its support for the current super performance test, emphasising the importance of keeping the process straightforward.
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