Treasurer Scott Morrison confirmed that superannuation tax concessions will be pared back in the May budget, during a speech at a Melbourne business summit.
But, the Treasurer avoided committing to big personal and company income tax cuts.
Mr Morrison told the summit that the superannuation changes would be in-line with cuts to the part-pension that the Coalition passed through the Senate with the help of the Greens in 2015
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“Last year we successfully legislated the first phase of our reforms to retirement incomes with our changes to the pension assets test, reversing the taper rate changes of the Howard-Costello government that had extended access to a part pension to those with assets in addition to the family home of more than $1 million,” he said.
“These changes were based on the simple principle that the pension is a welfare payment for those who are not in a position to support themselves independently in retirement.
“After the change of leadership last September, we embarked on the second phase of reform to retirement incomes by addressing the various incentives and arrangements associated with superannuation.
“The outcome of this process will be announced in this years budget, at the latest, and will be designed to reflect our clear statement of purpose to be enshrined in legislation as recommended by the Murray Review, currently proposed as to provide income in retirement to substitute or supplement the Age Pension.
“The changes will be about delivering a fairer and more sustainable retirement income system for our 21st century economy building on the pension reforms in last year’s budget.”
Asked on Tuesday if he would reward risk takers in the economy through significant cuts to income tax rates, Mr Morrison said other stimulus measures needed to come first.
“We will try and find a way to ensure the earners in our economy get a better deal out of our tax system, but we’ll have to start with those areas that are most likely to drive growth,” Mr Morrison said.
He insisted controlling expenditure was the best way to cut taxes while fulfilling the government’s plan to drive jobs and growth.
“Our principal budget challenge remains expenditure – not to chase higher levels of spending with higher taxes as our opponents propose,” Mr Morrison said.
Against the backdrop of speculation suggesting the budget will be brought forward as a precursor to an early election, Mr Morrison said it is booked for May 10 as planned.
– with AAP