On Wednesday (23 November) the House of Representatives passed legislation on the gradual increase of compulsory superannuation contributions from 9 per cent to 12 per cent.
The legislation includes measures to remove the age limit of the Superannuation Guarantee as well as removing superannuation contributions tax for people earning less than $37,000 per annum.
“The Financial Planning Association (FPA) welcomes the Government’s passing of the Superannuation Guarantee Bill and the measures incorporated to assist our aging population with the incentive to remain in the workforce as well as maximising the retirement benefits for low income earners in Australia,” said Mark Rantall, CEO of the FPA.
“This legislation better supports all workers without discriminating against age or wage. The FPA supports initiatives taken by Government to assist Australians in planning their financial futures and ensuring they are better prepared for retirement.
“An increase in the Superannuation Guarantee and encouragement to seek professional financial advice will enhance the quality of life during retirement, ensure income adequacy, reduce longevity risk and decrease reliance on the age pension for Australia’s ageing population. It is timely that the Government is addressing this national issue now.”
The majority of the reform measures are expected to take effect from 1 July 2013, with the low income rebate commencing from 1 July 2012.
The superannuation industry also welcomed the passage of the mining tax bills package.
The mining tax will support the increase in the SG to 12 per cent, as well as a low-income earners super tax rebate.
Source: http://www.professionalplanner.com.au/superannuation/thumbs-up-for-super-guarantee
Cheers,
Rashesh Bhavsar
Financial Planner
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