Instead of looking to cut levels of income tax, the Australian government would gain more from abolishing the 15% tax levied on superannuation fund contributions, according to the super funds industry body.
"It's an election year and it really is important that both individuals and the government think about what needs to be done to improve savings," Association of Superannuation Funds of Australia (ASFA) chief executive Philippa Smith stated in an ABC radio interview.
ASFA contends that the $3 billion that the government may shave off the income tax burden would be a lot less beneficial than the boost in savings resulting from a cut in the $5 billion in tax levied on the superannuation find industry.
ASFA’s plea has not fallen entirely on deaf ears in the Australian political arena, and the opposition Labor party have already pledged a reduction in tax on super funds if elected.
"Security in retirement is pretty fundamental to Australians," Labor's retirement incomes and savings spokesman Nick Sherry observed, according to The Australian. “We'll have a positive set of proposals in the run-up to the election," he added.
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