Super boost outshines tax cut
AS far as I can tell, we’re the on only country that goes a little H Hollywood for the Budget.
Other nations just read th theirs out in parliament and no one gives a toss. Not us. We lock all the journalists up, p and give Treasurer Scott Morrison the prime-time ra razzle-dazzle.
And this Budget was a lit little ... Family Feud. A bit, er, bo boring. So what did we learn? My first takeout is that Australia is the Jay-Z of the world economy ... we’re swimming in cash. That’s largely because there’s been an uptick in the global economy, which is boosting the price of our resources. It’s also because unemployment is low. Oh, and we’re also running a fairly aggressive immigration policy.
This pile of cash is what’s funding the centrepiece of the Budget — a $10-a-week tax cut for low- and middleincome earners. It’s what ScoMo hopes will fund what is effectively a “flat tax”, where 94 per cent of the population pays 32.5 per cent or less, (in seven years’ time).
Look, in seven years’ time THE Federal Budget is behind us, and amid the celebrations over tax cuts (around $500 annually for low to middle income earners), now is the time to be mindful of scammers pretending to be from government bodies — especially the Tax Office.
In some cases, scam victims have lost close to $1 million.
If previous years are anything to go by, the end of the financial year will bring the inevitable wave of scams. Money watchdog ASIC for instance, has recently warned about crims posing as ASIC representatives asking victims to pay bogus fees. They often make contact via email, accompanied by an invoice that infects your computer with malware if you click the link.
Protect yourself by looking for warning signs that show an email isn’t from ASIC at all. The clues include requests to make a payment in order to receive a refund, or if the email asks directly for your credit card or bank details.
More worryingly, the Tax Office has recently advised that scammers are leaving voicemail messages on their victims’ phones, threatening the recipient with arrest due to an unpaid tax debt or suspected tax evasion. It can be scary stuff for those on the receiving end.
Scammers are also sending fake emails asking for completion of a “tax refund review” form to allow I plan on living on a Tuscan vineyard so I can drink vino and wear slacks without socks ... but I’ll have three kids in primary school by then, so the closest I’ll get to bellissimo is La Porchetta.
Bottom line? I’m not getting my holiday lifestyle, and you’re not getting your flat tax.
Anyway, while the tax cuts stole the limelight, the real, largely ignored, story was the changes to super. So here are three things that really deserve attention:
First, if you’ve been shocked by what you’ve seen at the royal commission, you can now teach these bozos a lesson, switch your super fund and not get pelted with exit fees.
Second, a campaign that I’ve been banging on about for years is the rort of compulsory life insurance through super. Young people collectively pay nearly $200 million a year in life insurance they don’t need.
The government will now force super funds to stop automatically charging people under the age of 25. That’ll add thousands of dollars to young people’s end balances.
Third, the government is finally moving to protect one of the biggest cash cows of the super industry: the six million inactive accounts that super funds feast on.
The government has put a fee cap on these low-balance funds and is making it easier to consolidate them.
All in all, it was a terrible night for the super fund lobbyists, which means it was a great night for you and me.
In fact, I think the super changes will potentially have a bigger long-term impact than the short-term tax cuts.