Recommendations that emerge from the Tax White Paper such as potential changes to the franking credit regime are unlikely to be implemented until after the next federal election, according to one practice principal.
Bluepoint Consulting practice principal Tony Bates told SMSF Adviser that while the Coalition government will eventually want to adopt some of the recommendations of the Tax White Paper as policy, “legislation is still a way off”.
“I think it would be politically challenging for the government, given the current political climate for the Coalition,” said Mr Bates. “I think they’d be pretty brave to take it on prior to an election.”
Aside from examining and changing the franking credit regime, which Mr Bates said is currently very generous, the Tax White Paper will likely also look to even up taxes between the pension phase and accumulation phase.
“They’ve said they’re looking at the relative rate of tax between the pension phase and the accumulation phase and they’ve been quite clear they want to even that up,” said Mr Bates.
“The way I’d interpret that is there’ll be taxes on pensions whereas at the moment a super fund in pension mode is tax exempt so I see that changing and likely to be policy.”
Various industry lobby groups are calling for extensive national tax reform, with a particular focus on superannuation tax concessions.
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