United pushes for tax deductibility of super payments

United Future is pushing for changes to superannuation which would include allowing people to claim payments into a superannuation fund as a deductible expense.

Wednesday, January 19th 2005, 3:13AM

by Rob Hosking

Party leader Peter Dunne earlier this week set out the party’s policy agenda for the year, with a renewed emphasis on family friendly policies.

Specific menton of superannuation was confined to a pledge that the state funded pension should keep pace with the cost of living.

However an enquiry to Dunne’s office by Supertalk revealed that the party also wants to allow people to set payments into approved superannuation schemes against tax.

The party, which has a formal coalition agreement with Labour and which is likely to form part of whichever government is formed after this year’s election – has previously successfully pushed for changes to the tax status of workplace superannuation schemes.

Dunne also wants to see NZ Superannuation paid on a more generous format.

The present rule is “65 at 65” – 65% of the average wage paid at the age of 65 for a married couple. However that is misleading, he says, because the cost of living adjustment is carried out in arrears – the value of the payout drops below 65% during the year.

The party wants to see the cost of living adjustment made in advance, which would mean a marginally more generous payout.

United Future’s finance spokesman Gordon Copeland last year indicated interest in raising the payout to 72.5% of the average annual wage – but only if the government can afford it. Both New Zealand First and Labour's other ally, Jim Anderton’s Progressives, want to see the payout lifted to 72.5%. However Dunne says this is not United Future’s policy.

Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.

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