Lifting the superannuation guarantee to 12% and pushing a 20% rebate on marginal tax rates for super contributions would have no effect on the federal budget.
This is according to the latest modeling from PwC prepared for the Financial Services Council (FSC), released yesterday.
PwC modeled rebate levels at 10, 15 and 20%, with the lower options showing an expected increase in tax receipts if the super guarantee continued its path to increase to 12% on 1 July 2021.
The modeling also assessed the impact the three changes to concessional contributions would have if the current super guarantee (SG) rate of 9.5% was to be kept.
If the SG was fixed at 9.5%, the decrease in tax receipts would be less than $1 billion to $4 billion. An increase to 12%, following current legislation, would see tax receipts decrease by less than $400 million.
The Australian Chamber of Commerce supports the direction of the FSC's proposal on superannuation taxation, but believes it is misguided on the superannuation guarantee issue.
The Chamber has warned about increasing the mandatory employer superannuation contribution rate to 12%, saying it will operate as a tax on employment.
Australian Chamber of Commerce chief executive Kate Carnell said "increasing the superannuation guarantee will impact not only employers but also the community through reduced growth and job creation."
"Increasing the superannuation guarantee levy to 12% may put jobs at risk, particularly if there are no corresponding wage trade-offs," Carnell said.
"This seems at odds with policy settings aimed at stimulating entrepreneurship and start-ups, and does not support growth among small and medium enterprises as we seek to diversify our economic activity.
"Debate about retirement incomes must focus on restoring confidence in superannuation and maximising the returns from current contributions rather than hiking mandatory contributions, particularly given current volatility in the share and property markets. More broadly, we must consider if it is appropriate for employers to bear the major direct burden of the superannuation levy."