LISC scrapping slammed by industry bodies
The government’s plans to drop low income super contributions (LISCs) has been slammed by industry bodies as a measure that will have an “enormous impact” on low-income earners.
Speaking to SMSF Adviser, Taxpayers Australia’s Reece Agland said LISC is an appropriate measure to the “unfair” position low income earners face in relation to superannuation.
“Most people receive a tax benefit in putting their money in superannuation as it is taxed at a lower rate than their marginal tax rate. Low income earners who pay no or the lowest tax rate are disadvantaged and do not get the full benefit of putting their money in superannuation,” Mr Agland said.
“They need to be compensated for this and LISC is the most effective means of achieving this. We understand that the government has said it will get rid of all measures paid for by the mining tax but we believe the benefits of this measure outweigh the fact it is associated with the failed mining tax.”
Industry Super Australia’s chief executive David Whiteley also said the retention of LISC is necessary for the integrity of compulsory super.
“The reality is that until every Australian received a tax concession on their super contributions, no other changes to the taxation of super will be accepted by the community at large.”