Earlier this week, chief executive of the IPA Andrew Conway said there are a number of methods that could prevent superannuation from becoming an estate planning tool – an issue that federal treasurer Scott Morrison has flagged as a government concern.
These can include limiting tax concessions above a certain level, or imposing higher levels of taxation on the transfer of death benefits to non-dependants as bequests.
“The objective of our retirement system is to improve retirement incomes, but there needs to be a limit to the amount of taxpayer support to ensure fiscal sustainability,” Mr Conway said.
Mr Conway suggested the IPA is also on board with enshrining the objectives of superannuation into legislation, as originally proposed in David Murray’s Financial Sytem Inquiry.
“We agree that an updated legislated objective will serve as a guide to future reforms assisting policymakers, regulators, industry and the community about the fundamental purpose of superannuation,” he said.
“Our superannuation system is already doing well in regards to its principle purpose and enshrining its purpose will provide an enduring reference point to guide future decision making by all policymakers, which will go a long way in instilling community confidence in superannuation.”
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Not only these two measures but others such as anti-detriment payments, re-contribution and transition to retirement pension should also go.