The Australian Government is committed to maximising retirement incomes for more Australians.
Raising taxes on lump sum superannuation payments taken before the age of 65, as recommended in the OECD's Ageing and Employment Policies: Australia, will not achieve this outcome. The only supporter of higher taxes on superannuation in Australia is the Labor Party.
"Australia has one of the best superannuation systems in the world. It is robust, incentive driven and concessionally taxed – and the Coalition believes this is the right mix to ensure consumers can make the right provisions for their retirement."
The OECD's report recommended that taxes on lump sum superannuation payments taken before the age of 65 should be subject to less generous taxation treatment to discourage older people from leaving the workforce early.
The Government rejects that approach.
"The only party supporting raising taxes on superannuation in this country is the Australian Labor Party, which is committed to keeping an unnecessary tax in place in the form of the superannuation surcharge.
"This Government believes that it is the individual who is best placed to make decisions about their money, and their retirement. Allowing Australians to take their superannuation benefits as a lump sum or income stream provides flexibility to retirees, allowing them to structure their retirement arrangements to best suit individual circumstances.
"The Howard Government has transformed Australia's retirement landscape to make sure that those Australians who want to continue working are also rewarded for doing so."
From 1 July 2005, the Government's transition to retirement policy will allow a person who has reached their preservation age to access their superannuation through a non-commutable income stream while continuing in the workforce. In the past, Australians have had to retire completely from the workforce to access their superannuation benefits.