Raising compulsory Super contributions to 12 per cent may disadvantage low-income earners
Most Australians pay 9.5 per cent of their income into their super, but a compulsory super contribution increase to 12 per cent is proposed to occur in 2025.
Long-term projection analysis by the Grattan Institute predicts that the extra money in a low-income person’s superannuation resulting from the proposed increased contribution would be offset by the reduced pension payments based on the pension asset’s test.
Middle to high income earners would oppositely get an increase over the projected 23-year period in retirement.
Another loser: government. A rise in super contributions would decrease tax revenue since more income would be shielded by concessional tax rates that superannuation benefits from.
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http://www.afr.com/news/super-guarantee-at-12pc-leaves-poor-worse-off-grattan-institute-20180428-h0ze6y