Issue: 39
Sent: 21-05-2006 21:17:28
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Hyperbole or a Silly Joke? - Tony Negline
Want to hear a silly joke?
In the Weekend Australian, a spokesman for the Treasurer is confirmed that, "a fortnight into the consultation process, not a single glitch or logistical flaw had yet been pointed out in the [budget's super] proposal[s]".
When I read this, I wasn't sure if I should admire the brazenness or simply shake my head in dismay. Perhaps he wasn't talking about the same documents I had been reading.
Does it really matter what we think anyway? The government has said that it wants to implement the system. It has the parliamentary votes to do this. From where I sit no one has time to complain because they are simply flat-out trying to work out how the new rules will work and ensuring their business is are ready ASAP.
Well thus far the politicians sell has been simplification.
Personally I don't believe it. The real reason behind these changes is to get rid of Reasonable Benefit Limits by severely restricting the amount of money that can be put into super. Hence the limit on undeducteds and deductible contributions taxed at concessional rates and the banning of rolling over employer ETPs.
Why get rid of RBLs? In the ATO's 2004/05 annual report, released in late October 2005, said that, "We currently hold details of approximately 11.7 million reportable reasonable benefit limit benefits, related to around 4.8 million individuals. Data holdings are increasing at the rate of around 8% a year. Last year we processed over 1 million benefit reports received from funds and employers. Since 1991, approximately 117,000 individuals have received excessive determination notices, representing 2.4% of individuals who have a recorded benefit...Given the size of the reasonable benefit limit data holdings and the potential requirement for the Tax Office to maintain records for every Australian over their lifetime, we need to invest significantly in rebuilding our information technology systems and redesigning our business processes and practices to overcome existing deficiencies and ensure sustainability of reasonable benefit limit administration. This investment and the overall effort required to administer reasonable benefit limits appear disproportionate to the number of individuals ultimately affected by the provisions."
And there you have it.
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