Lord Herbert wrote on Jan 7
th, 2016 at 8:13pm:
[quote author=bobbythebat1 link=1452153018/16#16 date=1452161158]
Hi sir Crook,
it's a scandal that pensioners are facing poverty after
a lifetime of building our country.
Thank you for posting the truth regardless of how awful it is.
I was doing 'casual' with a German in his 60's, and he surprised me by saying that Australia's aged pension rate is a disgrace for how poorly it compares with that of Germany and other European countries.
[/quote
I don't live in poverty, but after working for 48 years, I wouldn't say that I,am that well off, particularly due to high medical cost in old age, and the meanest means test of the age pension.
No politician would try to disprove what I write below: I wonder if anyone here will do it.
Any comment, positive or negative is welcomed.
In 2007 the then Prime Minister John Howard introduced the tax-free super for the over sixties, if the super income comes from a so-called taxed fund.
As a result :
This is how the retirees are treated in Australia.
Retiree: 1)
Worked for 45 years and paid taxes, but did not accumulate enough assets to be completely independent of the age-pension. For every dollar of extra income for him and his wife above $6,500, the couple loses $0.50 of age pension, and if their income exceeds $45,000 per annum, the couple will pay tax of $0.315 in the dollar including medicare levy, leaving them with an income of $0.185 from every dollar extra income. For the defined benefit income a 10% tax-offset applies if paid from an Australian super fund, but not if the income comes from an overseas fund.
Retiree 2)
Has accumulated assets of $1.5million,mostly with huge tax concessions, and the assets are in a so-called taxed Self Managed Super Fund. To be very conservative, the assets are in a term deposit earning 7.0% income of $122,500 per annum and even if the retiree is single, he/she will not pay a cent of tax.
Now if the assets are in fully franked shares, like banks, and return $100,000 worth of franked dividends, he/she will again pay no tax on the dividend, and the government will send him/her a cheque of $30,000 for the franking credits.
Should the assets of these retirees fall below a certain level, they will be entitled to the age pension as anyone else, therefore why does the government provides the rich retirees with such huge tax concessions, while punishing the retirees at the lower income scale with the punitive means-test of the age pension?
Retiree 3)
Is an ex-politician or highly paid public servant, in receipt of a defined benefit pension of $100,000, on which he/she will have to pay tax, but he/she gets a 10% tax offset, which equals $10,000 after reaching retirement age, but before retiring, the public servant can establish a SMSF and contribute into it extra with tax concessions if the $25,000 total for under fifty and $50,000, if over fifty is not exceeded and in addition he/she can contribute $150,000 from after tax income, and the earnings from the SMSF will only attract 15% tax, and when the person reaches the age of 60 even the income will be completely tax-free for the SMSF.
Retiree’s 2) are well represented by the media and the super industry, as well as the Unions, and retiree’s 3) are represented by the government, and ironically by the leadership of various retiree Associations, like ACPSRO and its affiliated Associations,Acoss,COTA, but who represents retiree’s 1) the part- pensioners who are being robbed of a decent standard of living in retirement by the means-test of the age pension.
What is the fairest solution; scrap the mean test of the age pension and scrap all tax concessions for super.
Will the government change anything, as long as the above mentioned Associations support the government; never.
.
Is there any other country which treats its citizens in such a discriminatory manner?
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