The accuracy of the content is not guaranteed. Please rely only on the authorised document. The Financial Planning Association has backed calls by the ALP and the Democrats to remove the superannuation provision from the New Business Tax Bill. In a report tabled in parliament, ALP and Democrats representatives on the Senate Select Committee on Superannuation and Financial Services, argue that the application of capital gains tax on DIY super funds would result in excessive compliance costs and would work against self-sufficiency in retirement. Whilst the FPA generally supports the Bill, it believes the proposed new taxing point in superannuation is inherently unfair because it effectively forces DIY funds to realise assets thus triggering CGT, whereas larger funds have adequate cash reserves to avoid the tax. In its submission to the Committee this week, the FPA stated that the superannuation measure was short sighted. FPA chief executive, Michael McKenna says the Bill fails to consider longer-term budgetary implications. "Preliminary research undertaken on behalf of the FPA shows the total cost to government could be up to 45 billion dollars a year as a result of Australia's ageing population. The proposed CGT measures in this Bill would only exacerbate this problem by reducing private savings," says Mr McKenna. "The FPA looks forward to working with the Government to develop a fair and equitable solution on this matter. On a broader scale, the current debate highlights the need for a comprehensive review of the Government's national savings and retirement incomes policy," says Mr McKenna.
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