The top 1 per cent of Australia’s high incomes couples set for retirement in 2055 will be receiving over $5 million in government assistance, according to estimates revealed by Industry Super Australia (ISA).
ISA says the current superannuation tax breaks on offer are creating an uneven level of support, with high earners, and high earning men in particular, earning big over their lifetime.
“Super tax breaks for top earners are outstripping assistance to middle and low income Australians, especially women, even when the age pension is included. This is at odds with the core objective of the retirement system,” CEO of Industry Super Australia David Whiteley said.
“Disturbingly, the lowest earning 10 per cent of couples will pay extra tax of about $75,000 on their super over their lifetime. Instead of a tax break, it’s a tax charge on the people who most need help.”
Mr Whiteley said the average low income earner would have at least 3 years’ more work because of these tax charges.
“Tax concessions should benefit those who need the assistance. The current superannuation tax breaks, perversely and unsustainably, do the opposite.”
According to the ISA-Rice Warner modelling estimates, 65 low income couples paying tax on their super “effectively” funds the tax breaks enjoyed by the top 1 per cent of high income couples.