- Joined
- 20 July 2021
- Posts
- 11,708
- Reactions
- 16,315
but would they also apply it to politicians and senior government officials and their generous retirement fund
but would they also apply it to politicians and senior government officials and their generous retirement fundFirstly, I personally think that Labors suggested cap on super is brilliant, but I doubt they actually will push it through, mainly because how will the industry funds keep the ponzi going when there is a cap on how much members can have in it.
I doubt it, the same as when the super surcharge was enacted, politicians, high court judges and those in senior management roles were exempt. ? ? ?but would they also apply it to politicians and senior government officials and their generous retirement fund
From today's Weekend AFR : ( Some of it , at least. The rest , I just made up )
Super's pension account limit goes up to $ 1.9 mill. from July 1 2023. right ? but the Greens , bless ' em , want the now, likely $ 3 Mill. cap for tax concessions reduced to ...$ 2 Mill. There will be more squawking from them next week , no doubt .
Our socialist buddies down at the Gratten Institute, not wanting to be left out of the class warfare game, object to any " grandfathering " of existing funds already above the $ 3 Mill. threshold , saying that measure, alone , will pull in an extra $ Billion dollars in extra tax every year. Effectively , they want a " soft" cap , allowing assets above $ 3 Mill. to stay in the super fund, but just taxed more. Neat, eh?
Off topic, again, but this rag has a $ 4.50 cover price, these days. You would think some human would at least read the damned thing for spelling and grammar errors, before going to the printers.
" Putin's raging war on...." It's not a one-off, either . And any day of the week , too.
Climbing down off soap box, now.
We should keep in mind it isn't only politicians and think tanks which are voicing support for a cap. Support is also coming from superannuation funds such as AustralianSuper and the body aka lobby group, representing industry funds. Behind a paywall.
"More of Australia’s biggest super funds have joined the call for a $5 million limit on account balances, while Mercer is pushing for an even lower cap of $3.4 million, suggesting the savings could be diverted into schemes to help reduce the retirement savings gap between men and women.
CareSuper, HESTA and Aware Super have joined behemoth AustralianSuper in backing a $5 million cap amid debate ahead of the May federal budget"
Super funds throw weight behind $5m balance cap
More of Australia’s biggest super funds have joined the call for a $5 million limit on account balances, while Mercer is pushing for an even lower cap of $3.4 million.www.afr.com
Now should you get support for a concept from industry players..............
I haven't had the time to do a full deep dive into the different suggestions, but off the top of my head I would think a cap of 5mil with anything above 5mil be taxed at the corporate tax rate. the tax advantages for those with less than 5mil would still be there and it wouldn't be too disadvantageous for those who have built up a large amount.
I'm in Canberra myself and I dare say there would be a few with their DB rather high. I always thought if a super or DB was partially funded by gov (think ADF, also probably APS) that it was generally exempt from a lot of things. I'd assume they would seperate the DB from super -- but that's just speculation.Discussions are now revolving around a $3m cap.
Could get interesting with a few permutations applying. Living in Canberra I know of some former public servants who have relatively large defined benefits pensions (lucky them!) as well as a SMSF. With the introduction of the balance cap, the calculations meant the SMSF reverted to accumulation phase. I was mulling over a possibility if the SMSF is say $2.5m and the calculated balance cap of the DB is $1.6m or whatever it is, would that amount be added to the amount in the SMSF to bring the total to $4.1m and if the cap is $3m, what happens? I'd like to be in that position by the way and I am certainly not shedding tears on their behalf.
I should add it there are a many former public servants who don't live in Canberra who could be in the same position but my exposure is to those where I live.
I'm in Canberra myself and I dare say there would be a few with their DB rather high. I always thought if a super or DB was partially funded by gov (think ADF, also probably APS) that it was generally exempt from a lot of things. I'd assume they would seperate the DB from super -- but that's just speculation.
I know of some ADF members who have reached their cap long ago. I'm unsure how it is managed as the whole ADF and super is another complex beast.
Or Robert could do what someone I know is doing, going to be on welfare all their lives, lucky Robert worked all his to pay for it.
I would be happy if they put whatever limit they like on super, as long as those with more than the limit are allowed to extract it without penalty.
They will have to invest in something else that attracts tax, preferably above the 15% they were paying prior to taking it out.
Mick
Is that total balance of a SMSF or per member?They've read the room. 30% above $3m looks like a goer.
Around 80,000 people are expected to be affected by the change, or 0.5 per cent of those with super accounts.They've read the room. 30% above $3m looks like a goer.
Is that total balance of a SMSF or per member?
As with so many government initatives, it is the unexpected (to them) consequences.Around 80,000 people are expected to be affected by the change, or 0.5 per cent of those with super accounts.
The change will come into force in 2025-26 and will not be retrospective. It also won’t limit funds in the accumulation phase.
The government expects the change to generate revenue of about $2 billion in its first full year..
I will give Chalmers more credence were he to treat all the pollies and public servants in the same manner in which he does the private sector.Prime Minister Anthony Albanese, unlike his predecessor Scott Morrison, has joined the ranks of the ‘$10m club’ – the large number of former and current public servants and politicians who have government pension and superannuation entitlements that are worth more than $10m.
The unfunded long term liability to the members of this club plus lower paid public servants – all of whom joined the public service before June 30, 2005 (2004 for politicians) – is officially calculated at $300bn. But the assumptions behind that shortfall calculation are highly dubious and the real shortfall is between $500bn and $1 trillion.
Albanese plus Opposition Leader Peter Dutton were both elected to federal parliament before 2004 and so they and their spouses/partners are entitled to generous pensions indexed to the CPI for life.
The massive shortfall comes not so much from politicians and ordinary public servants but the highly-paid public servants who creamed the system.
The members of the ‘$10m club’ and others entitled to huge benefits have always defended their generous entitlements by stating that it was the parliament which set the entitlements and any change to them would be would be retrospective legislation and represent horrific injustice.
But instead of blocking existing rorts in the public sector, he (Chalmers) turned his attention to the private sector where he found that about 11,000 people had superannuation balances above $10m which he regarded as an abuse of the system albeit that they, like the public servants, had acted perfectly legally in taking up their entitlements.
His first plan was to limit the amount of funds any person could have in superannuation to $5m.
Leaving aside retrospectivity I thought that measure was fair but it would be totally unfair if the $10m dollar club benefits were untouched on the grounds that they were immune because it would represent respective action – exactly what was being applied to the equivalent private sector.
where is Rockpool ??
I think Rockpool is a poncy restaurant in Sydney.where is Rockpool ??
i could live very comfortably on $250,000 a year probably because i don't own/lease a car , and IMO Europe is over-rated ( currently )
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?