Superannuation Industry Stewardship Group special briefing 28 April 2021

Welcome and introductions

David Knox opened the meeting and welcomed members and guest presenter Dr Cain Polidano.

Impacts of capping concessional superannuation contributions

Dr Cain Polidano, a member of the Tax and Transfer Policy Institute (TTPI) gave a presentation on the impacts of capping concessional superannuation contributions.

The presentation discussed how concessional caps affect superannuation contributions, taxable income through changes in earnings, income tax revenue and other forms of savings. It included behavioural responses to changes in concessional caps.

The group walked through the key findings of the TTPI study which found that the higher caps increase retirement contributions considerably, with around two-thirds of this response financed by increases in earned income.

Other key findings include:

• Evidence suggests that the top 5% of contributors who contribute at least $23,000 in consecutive years, were found to have strong income responses.
• Income / labour supply responses to cap changes are more important than previously thought.
• Concessional cap changes are income tax neutral.
• There is evidence of weak substitution with after-tax contributions.

Wrap up and close

David Knox thanked Dr Cain Polidano for presenting to the Superannuation Industry Stewardship Group.