Katy Gallagher (ACT, Australian Labor Party) Share this | Hansard source

I thank Senator Cormann for assisting there, as we resolve some of the issues around my amendment (5). You are right, Senator Cormann, in relation to what we are seeking to do, which is to lower the annual non-concessional contributions cap to $75,000. We believe that this is a reasonable position to take.

We are mindful of the evidence that shows that only 0.7 per cent of Australian taxpayers made $100,000 or more in non-concessional contributions in 2012-13, and over 86 per cent of taxpayers made no non-concessional contributions whatsoever that same year. That does show, in terms of the capacity for people to put more non-concessional contributions into super, that there is the capacity, if the cap is set at $75,000—along with the concessional contributions at $25,000—for an individual, in any year, to put $100,000 into super savings. Again, it is no surprise that only a very small percentage—less than one per cent—of Australians are able to do this. Just thinking it through: how many people do you know have a spare $75,000 to add into their superannuation savings? It is clearly reflected in the evidence. This proposal would allow people to still put in significant amounts of savings into super, and it would also accommodate those large one-off lump sum payments that some Australians might be in the position to make.

By bringing forward three years of contributions into a single year, the Treasury figures—and these were provided, I think, during estimates and in answers to questions by Labor—show the average contribution for one-off lump sums is $135,000, which is well below the $300,000 that would be allowed under the government's plan and the $225,000 that would be allowed under Labor's plan. By lowering the annual non-concessional contributions cap to $75,000 Labor would ensure the carry-forward allowance remains generous enough to accommodate those kinds of one-off contributions that middle- and low-income taxpayers make but would also do a proper job of cutting back opportunities for higher income earners to gain tax concessions for large annual contributions—something on which, we believe, there is further room to move in relation to the positions being put by the government and by Labor.

Through these amendments we are trying merely to reflect the position that Labor has taken publicly, as I said, around the positions that we have outlined in our budget. It has not been an ideal to work through the amendments, as everyone has been very busy this week—particularly with registered organisations and the drafting of amendments for that—and this has led to this issue that we are trying to resolve at this point in time. What I would like, if I need to amend my amendment (5), is to have that merely reflect the position of Labor's position of lowering the non-concessional contributions cap to $75,000.