Yesterday, after months of speculation, the government confirmed it would be scrapping its contentious $500,000 lifetime cap on non-concessional contributions.
It also announced other changes, including delaying the start of the five-year rolling concessional contributions caps for taxpayers with a super account balance under $500,000, and scrapping plans to eliminate the work test for superannuation.
Mr Howes, now a partner and head of wealth advisory at KPMG, said that given the “ongoing furore” over the super tax measures announced in the federal budget, it is a relief that there is now some certainty on the government’s superannuation plans.
“For the last five months there has been considerable uncertainty in the industry, which has damaged public confidence,” Mr Howes said.
“The Australian superannuation system is too important to withstand any more of this sort of speculation. Policymakers need to consider the potential effects on public confidence when they are putting forward future proposals in this space.”
Broadly speaking, Mr Howes said the government’s addressing of the more “contentious” issues, while difficult, is effectively a workable compromise and a reasonable outcome, given the circumstances.
“It is a relief that there has been a resolution to this issue, and I would trust that Labor will now support the proposals,” he said.