Pitcher Partners’ Charlie Viola today said that the government’s plans for superannuation are the lesser evil when it comes to changes to the superannuation system.
“Looking at the details released this morning on superannuation, the best we can say is that it’s not as bad as it could’ve been,” said Charlie Viola, Wealth Management Partner at Pitcher Partners Sydney.
“We’re talking about a small proportion of Australians who earn over $180,000 a year and are hence affected by the higher tax rate for super contributions.
“And when we’re looking tightening the cap for contributions out of concessionally taxed funds, Australians aren’t topping up their super contributions to $30/35k.
“We still believe that the long term goal of all governments should be to build confidence in the superannuation system, and reducing the caps ultimately may have some impact on that.
“There is an inherent contradiction in forcing people to save and then saying ‘wait, hang on, don’t save too much’.
“Ultimately though, if it’s a choice between these reforms and taxing actual retirement income streams differently, this is the lesser evil.
“We would caution the government very strongly against making any changes that compromise the tax-free environment of the super pension phase.
“We also caution the government against any changes that target the non-concessional cap.
“After-tax contributions to super are something the government should want to encourage; every dollar that Australians save for their retirement is a dollar that doesn’t have to come out of the federal budget.”
For further information and comment please contact:
Charlie Viola, Partner, Pitcher Partners Sydney, 02 8236 7798
Sabine Wolff, Media and Communications Advisor, Pitcher Partners, 0419 529 577