Progressive super

Ending unfair tax breaks and boosting super for low-income earners.

Supporting people to save for retirement

Australia’s once world leading superannuation system was established over two decades ago to ensure our ageing population can retire in comfort and to preserve the pension for those who really need it.

However, tax breaks in our current super system are regressive and provide the biggest incentive for those earning high incomes, allowing them to pour money into their super account to minimise the tax they pay. Currently there is a flat 15% tax on concessional contributions for people earning under $300,000 a year.

 The most disproportionately affected are women, low-income earners and casual workers.  60% of workers earning less than $37,000 are women, primarily because of commitments to care for others in their family, and they only work part-time for many years. This results in women retiring with around half the retirement savings of men. A progressive super system will go a long way in reducing the inequity of our retirement system.

Progressive super taxation

The Greens will end the unfair tax breaks in our super system, support low-income earners and raise the revenue we need to fund schools, hospitals and infrastructure.

The Greens’ approach to reform of superannuation would raise up to $11 billion of revenue over four years.

 

Taxable income

Current marginal tax rate

Current tax rate on super contributions (per $)

Greens’ proposed new tax rate on super contributions (per $)

$0-18,200

0c

15c*

0c

$18,200 – $37,000

19c

15c*

0c

$37,001 – $100,000

32.5c (37c from $80k)

15c

15c

$100,001 – $150,000

37c

15c

22c

$150,001 – $180,000

37c

15c

32c

$180,001 onwards

45c (47c w deficit levy)

15c**

32c

 

Read our plan

*This is currently given back to people on low incomes through the Low Income Super Contribution, which was scheduled to end after the 2016/17 Financial Year. In the 2016 Budget, the government has decided to introduce a similar measure called the Low Income Superannuation Tax Offset

**The rate is currently 30c per people with combined incomes and superannuation contributions of over $300,000, with proposals to reduce this to $250,000.

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