Second Reading Speech
This Bill amends various taxation laws to implement a range of improvements to Australia's tax laws.
Schedule 1 amends the Income Tax Assessment Act 1997 to ensure default members of superannuation funds are not adversely affected if their account balances are compulsorily transferred to a MySuper product in another fund as a result of the MySuper reforms.
Where superannuation funds do not offer a MySuper product, the MySuper provisions will require them to transfer their default members' account benefits to a fund offering a MySuper product by 1 July 2017. This measure allows the superannuation fund to transfer any tax losses and defer an income tax liability for assets transferred to the other entity.
Full details of the measure are contained in the explanatory memorandum.
Schedule 2 amends the Defence Force Retirement and Death Benefits Act 1973 to make consequential changes to enable the Commonwealth Superannuation Corporation - the trustee of the Defence Force Retirement and Death Benefits scheme - to release a lump sum for the purposes of meeting a debt account discharge liability; and to reduce the benefit as a consequence of that payment.
These changes are part of the sustaining the superannuation contribution concession, which effectively reduces the superannuation tax concession on contributions received by individuals whose income exceeds $300,000 from 30 per cent to 15 per cent. This ensures the tax concession received by higher income earners is more closely aligned with the concession received by average income earners. This will improve the fairness of the taxation of the superannuation system.
These changes to the Defence Force Retirement and Death Benefits scheme will ensure beneficiaries of this scheme are not disadvantaged in comparison to members of other Commonwealth defined benefit schemes and can have their benefits adjusted to meet their liability under the sustaining the superannuation contribution concession measure.
Full details of the measure are contained in the explanatory memorandum.