Budget could see big changes to Age Pension, tax and super, says BT

josh frydenberg

The government may consider significant changes to the Age Pension and the taxation of super in the budget this year, says BT Technical Services.

BT head of financial literacy and advocacy Bryan Ashenden said given the impact of COVID-19, the federal budget, due to be handed down on 6 October, could be a very interesting one. 

“If the government wants to make some significant changes to the way things have worked in the past, they may decide this is the time to do it,” he said.

Depending on the outcomes of the retirement income review, the government may consider changes to income testing and asset testing for the Age Pension, said Mr Ashenden, who added that it could increase the preservation age to encourage people to work for longer.

“Is it a time where [they decide] to change the taxation of the superannuation system? Where we move from a 15 per cent flat rate and zero per cent rate in retirement to having some taxation on earnings? Will it become the marginal tax rate less 15 per cent during accumulation?” he asked.

He also suggested the government may consider income tax rate changes. 

“There has already been talk about bringing forward the changes that were initially due to take effect from 1 July 2022 and whether they will be brought forward to 1 July 2021, or even brought forward to apply to this financial year and whether those other changes that were due to take effect 1 July 2024 will also be brought forward,” he said.

What do you think of these ideas?

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27 comments

Seeing Morrison and FriedBurger screamed "retirement tax" loudly and continually before the last election (even though that was never actually proposed by Labor) they'd have a pretty big hide if they touched retirement income themselves.

If it wasn't so serious it would be funny. They were crowing and smirking prematurely about being "back in the black" and having a "budget surplus". They didn't, and never will have. 

Farside, that's right. Throw in "budget emergency" which was quickly tripled by Abbott and co.

Well we would have been in the black if it wasnt for china 

robin hood, you're not seeing the forest for the trees. There is no way we were going to have a surplus budget, ask the RBA governor, and there is no way the LNP debt was slowing. The virus just made life more challenging, and there is still no evidence that China is responsible for the virus. Some research is now looking at likelihood of the source being another SE asian country - possibly Myanmar, Laos, Vietnam. 

No one is happy on this site.Just go with the flow,keep breading air.Iam age pensioner no super ,i get by.Of course its a tight ship but food on the table,warm bed,roof over my head.Been rich and poor ,now ok just cruising.Life around us is changing when you stay low its not much of a shock.

Hi Happy, I'm with you. (sort of) I was doing well on a pension that was untill i married,(big mistake) Now i get about $150 a fortnight and have a wife that thinks all her money is her's.  When i was single i had freedom,i could budget and life was good.  Marriage (big mistake).

Well no matter how bad ScoMo and coalition might be the Oppostion would be far far worse.  ScoMo must mange the economy over the next 2 years and the coaliion will win again.  There are a number of policies labor has wrong that the majoroty of citizens cannot come at.  

Based on what? Labor managed the GFC better than any other country in the world! Wayne Swan was named the best treasurer in the world by an international independent body and Australia's economy was given a AAA rating. That has continued to fall under the Liberals. If you look at the facts, Labor are better managers of the economy. It was lies by idiot Abbott and Credlin that made people think they're not.

Never underestimate the stupidity of australian citizens ... covid pandemic has shone a light on just how dumb some of them can be.

IMHO. It was the Greens leading a chatge on Queensland Indian Company Adani.

Also voters did not know the history of indian companies in Australia from WA especially. They do not bring in money but hope to raise the funds. Nothing against Indian people just some opportunistic companies

Lower the retirement age and give jobs to younger unemployed people

Frankly this is an idea that should be debated and considered however you don't see it included in the conversation. I'm pretty sure many of the unemployed over55 would take early retirement given the choice. Not all would go on age pension as many at the younger end would have accrued substantial superannuation to draw down.

Yep,agree.

I also agree --

Through all of this COVID debacle they have NOT ONCE taken a pay cut, reduced their own lucrative pension packages nor have they made a ruling that the Pension for retired pollies cannot be taken concurrently with employment post Government. They can still be in a highly paid position/s, often jobs handed to them on silver platters like Diplomatic positions and be collecting their pension at the same time. Who else gets that privilege? When you think how many times Parliament has actually sat this year it makes you wonder too. They have never stopped blaming Labor for debt incurred during the GFC and their mishaps, yet they rushed through ill-thought out packages. Sure, lots of workers have lost their jobs and needed help but even I personally know of many people who are on far greater money now with JobSeeker and JobKeeper than they ever were and they're laughing. The figures must be staggering and the system is open to rorting. The child-care package another debacle. But hey, we'll have to review the Age Pension. 

And the pollies reckon they earn it!  What a joke!

I also know many people who have received a much higher income during COVID, whereas others, like me, received nothing at all. JobKeeper and JobSeeker were knee jerk policies and really badly managed. Not that that is surprising.

Pollies earn their money!  WHAT A JOKE!

Have hardly been in parliament this year at all, also Morrison couldn't lead a horse to water ina drought he is a useless oxygen thief

Australia needs an overhaul when it comes to our Politicians.  They are overpaid, overindulgent, greedy and untrustworthy.  

 

People complain about politicians and their privileges, but their complaints are misdirected and useless. Politicians will win elections in a democracy. So stop voting for politicians displaying those despised qualities and start voting for change.  Vote for honest, decent candidates and preference the underdog so your seat eventually becomes marginal and the incumbent is then forced to listen to his or her constituency.

Seems once they get into politics they change and get greedy -- or are threatened and told what to do -- except as I said b4 Ted Mack was an exception

 

https://www.google.com/search?client=firefox-b-d&q=ted+mack+politician

Liberals have always attacked the old, the people on the dole and welfare recipients and Scomo with his smerking face thinks he has one over everybody. Yet the politicians take, take and take.

They truly believe everybody is less educated than them and they are at present laughing at ordinary people, yet refuse to give up any of the perks they get or accept a wage freeze like they want everyone else to have.

Scomo will be smerking when he talks straight about having to get back to where they were before Covid 19 hit. We all owe him? He sounds good and yes he is a good talker but underneath he is still a Liberal wanting it all for the wealthy. Look after them and you are guarenteed a fantastic job at the end of your term.

He's not actually a 'good talker'. He's good at talking, but if you listen carefully, he doesn't actually say anything and gives non-answers to questions.

Morrison is a talker but he says nothing  that is believable -- he is a typical salesman -- and I would LOVE to know why he was sacked from his former job --  in tourism -- and given a huge payout

Her we go again , shift the age of retirement , for one, the Jobs wont be available for most of us aged over 60 , two alot of the baby boomers started full time work at the age of 15 , so i think we have done our fair share, most politicians in power now days would not know what a hard day labour is , most of todays generation dont really start work for maybe another 5 years once they leave school as they attend university etc , so they would maybe be in shape to work longer at the other end . I 100 percent agree bring the retirement age down and let the new generation have the jobs , all that will happen by shifting the retirement age is more of us older generation will end up on the unemployment cue.Older poeple are also forced into work that perhaps they shouldnt be doing IE road train drivers at the age of 65 to 70 should not be operating these vehicles and these are some of the only jobs available to the older generation . Wake up politicians there will never be enough work for every one and it will get worse as technology grows , we need politicians in power that can plan properly for the future and not just be on there own ego trip .

Thats the idea Work hard.  They want you to stay in the work force for longer and if you cant find a job they will give you the lousy dole , its much cheaper for them.

I agree with you

Josh Frydenberg has the anwer which is, population growth is expected to halve to 0.6 per cent in 2021. He says building a strong economy is key so is encouraging people to have more babies.

So that means the largest deficit since World War II caused by coronavirus crisis, will be paid off by our great grandchildren and beyond. Boy we've got some brilliant minds in government LOL

 

 

Told to have more kids!???  most of the young ones I know are telling me they wouldn't bring any kids into this world of uncertainty -- and in any case why have kids when the government want you to desert them after 6 months and leave them for someone else to drag up --a Mother should be with the kid till it goes to school not farmed out to God knows where --

"Well we would have been in the black if it wasnt for china"  Robin Hood

As Pauline would say "Please explain"

Common wisdom is without China we would be broke.

Here we go again.

Over the last thirty or forty years our pollies have done a great job of wrecking the country.  A few of our leaders have done a great jpb of keeping the country relatively united.  Others have not been anywhere near as good a very few have brought concensus to the nation.  Instead they have:

sold off our assets

allowed foriegn companies:

to buy up our successful companies and our land, our utilities and resources

selling of our oil and gas

made sure that they don't have to abide by the rules they make for others, for example, their pensions and other benefits.  One suspects that if they were working for a "proper" boss in the real world most of them would be sacked for total incompetance.  It is time they became part of the real world and treated oll people equally.

#ScottyFromMarketing and his cronies tried several times to increase the retirement age to 70. It was only the Senate that stopped him. The Liberals won't miss an opportunity to stick the boots into anyone they regard as expendable to fund tax cuts for their rich mates.

(Yes they are still proposing tax cuts for the wealthy when the nation is facing it's biggest financial expenditure ever.).

It is inevitable the retirement age will be increased to 70 regardless who forms government but for the time being good luck with the playing modern King Canute to hold back the tide.

If we had kept all of our factories and made everything ourselves like we used to -- we were independent and everyone had a job but NO,  the governments have sold us out over and over and now we are dependent on others we will have to start trying to be independent again -- BUT they have also sold out most of our county too,   maggots that they are!

The reason the Libs always say they are in credit is because they sell off all the -----g assets

Aussie consumers and their addiction to cheap 'bargains' whether made in China or elsewhere is a significant factor in the demise of local manufacture.

Yes I'm a pensioner , but the Libs trying to put the retirement age up again is a joke .

I would gladly go back to work or to teach in a contsruction Tafe and pass on my experience if they would agree to cuts in their own salaries a super .

Isomehow feel this won't happen .

What you mean - Libs trying to put the retirement age up AGAIN? I remember it was the Labs putting it up to 67 under Kevvie Rudd. Possibly suits your poltical leanings to forget the facts.

retirement ages are increasing througout the OECD so no real surprise it rises as average lifespan increases. 

Figure 4.6. Current and future normal retirement ages for a man with a full career from age 22

https://doi.org/10.1787/888934041364

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