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Improving our superannuation regime : a post-Henry review look at superannuation taxation, raising superannuation balances and longevity insurance

journal contribution
posted on 2010-01-01, 00:00 authored by Rami HanegbiRami Hanegbi
This paper examines what, if any changes should be made regarding certain aspects of the superannuation system. Specifically, it looks at possible changes to the superannuation tax regime, measures intended at increasing superannuation balances, as well as policies aimed at improving the price and availability of retirement income streams. The recommendations of the final report of the Henry Review on these issues are also critically evaluated. The paper finds that a greater targeting of superannuation tax concessions towards middle and lower income earners would make the system more equitable and achieve other desirable goals such as increasing voluntary savings. Furthermore, the available evidence suggests that the current mandatory contributions rate of 9% is adequate, and a higher contributions rate is likely to have more costs than benefits. On the issue of superannuation income streams, the article finds that whilst taxpayers should continue to be allowed to take their superannuation as a lump sum, policies should be implemented to make lifetime annuities more readily available and better value for money. The Henry Review's recommendations on these issues, with some exceptions, are for the most part sound and based on logic.

History

Journal

Australian tax forum

Volume

25

Issue

3

Pagination

425 - 457

Publisher

Taxation Institute of Australia

Location

Sydney, N.S.W.

ISSN

0812-695X

Language

eng

Publication classification

C1 Refereed article in a scholarly journal; C Journal article

Copyright notice

2010, Taxation Institute of Australia

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