Superannuation guarantee charge survives High Court challenge

The Government's super guarantee charge (SGC) has held up to the scrutiny of the High Court, with the failure of a case launched by Roy Morgan Research.

The SGC is effectively the Government's only method of enforcing the super guarantee. It gives the Australian Taxation Office (ATO) the power to collect late employer contributions - along with interest calculated at 10 per cent, which is paid to the employee.

Roy Morgan Research argued that the ATO did not have the constitutional power to collect a levy for the "private and direct benefit" of employees, as opposed to the collection of money for "public purposes".

But the High Court judges ruled unanimously that the SGC was a tax, and threw the case out.

Assistant Treasurer and Minister for Financial Services and Superannuation Bill Shorten said he was pleased the SGC would remain in place to ensure employees were compensated appropriately if their employer was late paying their contributions.

"The SGC plays an important role in the integrity of our superannuation system, and I am pleased to see it will be maintained under this High Court decision," Shorten said.