Home' Policy Magazine : Policy Vol 32 - No 3 Contents GRANDFATHERING SUPER TAX INCREASES
12 POLICY • Vol. 32 No. 3 • Spring 2016
explaining and specifying proposed changes with explicit
consideration of the weight of taxation at all three stages,
10 Peter Costello, A Plan to Simplify and Streamline
Superannuation: Detailed Outline (Canberra: May 2006).
11 Peter Costello, ‘Simplified Superannuation–Final
Decisions’, Press Release 093 (5 September 2006).
12 Such untaxed funds are nearly all old state and federal public
service funds, mostly closed to new members, and catering
for fewer than 10% of all superannuation fund savers. I am
a retired member of one such untaxed fund that I joined in
1972, which is why I would be adversely affected by policy
proposals L-7 and G-7 in the Table on page 5 to reduce
the tax offset. (My superannuation fund has been closed
to new members for over a quarter-century.)
13 Australian Labor Party, Labor’s Fairer Super Plan
(see note 1).
14 Malcolm Turnbull quoted in David Crowe, ‘Federal
Election 2016: Turnbull Takes Sting out of Super’ ,
The Australian (30 May 2016).
15 Chris Bowen and Tony Burke, ‘Press Conference Transcript’
(Sydney: 27 June 2016), see note 4.
16 The $3 billion revenue loss goes to fund ideas such as a
Low Income Superannuation Tax Offset and a measure to
allow low income spouses to increase their super savings.
Expect these new ‘incentives’ today to become tomorrow’s
‘rorts’, and the subject of further future tax changes.
17 As I seem to recall, Peter Costello once said, ‘In government,
the easiest billion to save is the billion you have never spent.’
18 Brett Hogan, ‘ Why Scott Morrison’s Budget Super Changes
Are Retrospective’ (Melbourne: Institute of Public Affairs,
10 May 2016).
19 Scott Morrison, Address to the SMSF 2016 National
Conference (Adelaide: 18 February 2016), http://sjm.
20 For a compendium of 16 recent statements from
Treasurer Morrison that a Liberal government would
not increase taxes on superannuation, see Chris Bowen
and Jim Chalmers, Joint Press Release (20 April 2016),
21 John Daley, ‘Retrospective Claims on Super Changes are
a Furphy’, The Conversation (6 May 2016).
22 Malcolm Turnbull, Transcript of Doorstop at A.H. Beard
Mattresses (2 June 2016).
23 Ben Phillips, ‘FactCheck: Is 50% of All Income Tax in
Australia Paid by 10% of the Working Population?’, The
Conversation (28 July 2015).
24 The origin of the term ‘grandfathering’ in the 1880s in the
United States is informative, if offensive: some southern
US states sought to write ‘Jim Crow laws’ to deny freed
slaves voting rights by enacting educational or property
tax qualifications to register on the electoral roll. But
white legislators realised many of their own grandfathers
would be prevented from voting by such tests. (See, for
example, West’s Encyclopedia of American Law, 2005.)
The laws were then expressed so as not to withdraw
the voting rights of anyone who had previously been
entitled to vote—that is, the laws’ effects were literally
25 Jeremy Cooper, A Super Charter: Fewer Changes, Better
Outcomes (see note 8), with direct quote from page 24.
26 Bowen and Burke (see note 4), p. 5.
27 Ken Henry et al, Australia’s Future Tax System:
Architecture of Australia’s Tax and Transfer System,
Section 4, ‘History of Australia’s Tax-Transfer System’
(6 August 2008), p. 194.
28 Malcolm Edey and John Simon, Australia’s Retirement
Income System: Implications for Saving and Capital Markets,
Research Discussion Paper 9603 (Reserve Bank of Australia,
Economic Research Department, September 1996), p. 9.
29 Paul Keating, ‘ Taxation Arrangements for Lump Sum
Retirement and Kindred Benefits’, Press Release No 27
(30 May 1983).
30 Ken Henry et al, Australia’s Future Tax System—Retirement
Income Consultation Paper, Appendix B: A History of
Superannuation (Canberra: December 2008).
31 Paul Keating, The Story of Modern Superannuation,
Address to the Australian Pensions and Investment
Summit, (Queensland, Sanctuary Cove: 31 October 2007).
32 Treasury, ‘ Towards Higher Retirement Incomes for
Australians: A History of the Australian Retirement Income
System Since Federation’, Economic Roundup, Centenary
Edition (Canberra: 2001).
33 Australian Government, Budget 2009-10, Budget Paper No
2, Part 1, Revenue Measures (Canberra: 12 May 2009).
34 Trish Power, ‘Accessing Super: Preservation Age Now 56
Years (Since July 2015)’, MLC Super Guide (5 July 2015).
35 Liam Shorte, ‘Age Pension Changes: Keeping Your Super
Grandfathered’, Intelligent Investor (26 August 2014).
36 For details of the old and new schemes, see http://www.
bd0304/04bd131 For an account of Latham’s criticisms
and the Howard government’s response, see http://www.
The new, less generous scheme (which is an accumulation
or defined contribution scheme, and may take the form
of contributions into a parliamentarian’s self-managed
fund) was the only scheme offered to parliamentarians
first elected at (or after) the general election in 2004.
So John Howard and Mark Latham continue to enjoy
the old scheme they terminated while Malcolm Turnbull
(first elected in 2004) and Bill Shorten (first elected in
2007) entered the less generous scheme.
37 OECD, Making Reform Happen: Lessons from OECD
Countries (Paris: OECD, 26 May 2010), pp. 283-284.
38 KPMG Econtech, CGE Analysis of the Current
Australian Tax System (26 March 2010), http://treasury.
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