Luke Howarth (Petrie, Liberal Party) Share this | Link to this | Hansard source

I rise tonight to talk on this adjournment debate in relation to tax as well, as it happens. I know there is a discussion that the Australian community and the parliament is having at the moment in relation to tax. We have heard from the member for Moreton and his scare campaign on the GST, but he knows that it is not Liberal Party or coalition policy that we are going to do that. We are trying to have an adult conversation with the Australian people about all sorts of taxes—for example, payroll tax, which I believe is a tax that stifles growth. It is a tax that hits people when they want to employ more people. Is that a great tax to have out there? Income taxes vary as well; there are all different levels. So I welcome an open discussion about tax.

But I did want to talk quickly about superannuation. I believe that superannuation is essential and that all people, no matter what their age, should be putting money into superannuation. At the moment the government spends about $40 billion a year on pensions, which is something like 10 per cent of the budget—a very high percentage. We should be encouraging people to put more money into super so that, 20 years from now, there will be less money required for pensions. If we encourage more people to save and put money into super, that will mean fewer expenses that the government has to pay.

During this open discussion I want to rule one thing out as well—that there will be changes to super. I do not think it is the right way to go. I think that we should be encouraging all people, whether they are lower income, middle-income or high-income, to put more money into super. The days when you could put a lot of money into super are gone. The maximum that you can put in per year is $30,000, if you are under 50, and $35,000, if you are over 50. If you are a younger person under the age of 30 and if you salary sacrifice $1,000 a year on top of your wage and pay 15 per cent tax on it, then that is $850 a year that you are putting away. After 10 years, you have an extra $8,500 plus interest. So if you can put away that sneaky little amount if you are on a wage of $30,000, $40,000 or $50,000 a year, then that all adds up. If you are aged between 40 and 55 and you can afford to salary sacrifice $5,000 a year, at 15 per cent you would save $875 in tax. After 25 years, you would have some $106,250 after those concessions are gone.

So I would say to the government, which I am a part of, and to the opposition that we should be encouraging people to put more in super. We should not be looking to tax it more. When I talk to accountants, one of the things that they say to me when I am out and about in the electorate is that people do not want to put more money into super because the rules are always changing. We do need a bit of stability. As a government, as an opposition and as a parliament as a whole, we should not be looking at the concessions going, 'Gee, look how much money we could get back in tax if only we changed super.' We should being going, 'Hang on, we'll leave those concessions there, because in 20 years time future federal governments will not have the big expenses that we currently have on pensions.' Where is the foresight? Let us not take the easy road and hit super.

I say this in relation to low-income earners, middle-income earners and high-income earners: we need to be encouraging all of them to put more away. If you are over 55 and you are approaching retirement age, you need to be putting as much as you can in. If you can put in the maximum amount of $35,000 a year—you might be married and able to salary sacrifice a wage—that is a great thing to do. After you have paid your house off, hopefully, you can put more and more into super so that you are able to self-funded. I say to those self-funded retirees: thank you for what you have done; thank you for putting money away and not being a burden on the government. It would have been at a time when superannuation was difficult to put away. Super is really important for people under 50 at the moment, where they have been able to put more and more away. So I say to the parliament, leave super alone. Let us continue to give concessions, because it is only going to help future generations.