Accounting body CPA Australia has used its current year pre-budget submission to call upon the federal government to reset the superannuation concessional contributions caps back to their previous levels.
The government changed the contributions caps when it handed down the 2009 budget, cutting both limits by 50 per cent.
It meant individuals over the age of 50 can now pay in a maximum of $50,000 per year instead of $100,000 to their super to qualify for the concessional contribution rate of 15 per cent.
Similarly, people under 50 are limited to pay in $25,000 per year, from a previous level of $50,000, to their super in order to receive the same preferred tax treatment for their contributions.
“The government’s decision to halve the concessional contribution limits may have reduced some tax concessions enjoyed by higher income earners, but it has also reduced the ability of average Australians to adequately save for their retirement,” CPA Australia chief executive Alex Malley said.
“‘With an ageing population and greater number of retirees, it’s imperative now that we give people every opportunity to retire with sufficient savings and ease the burden on the public purse,” he said.
In addition to raising the contributions caps level, CPA Australia has also pushed for the introduction of a rolling concessional contribution cap that would see individuals being able to bring forward their caps for future years.
“‘Let’s empower people to take control of their super by offering incentives. At the moment, the current measures are too restrictive and pose a significant threat to Australians’ confidence in superannuation as a long-term savings vehicle,” Malley said.
