Ordinary Australians are regaining their faith in superannuation as a retirement savings tool after the removal of the super surcharge, according to the Investment and Financial Services Association (IFSA). It says a survey has revealed that more than 50% of respondents said they are likely to make additional contributions to their savings following the removal of the surcharge. 

IFSA CEO Richard Gilbert says 15% more respondents are willing to make additional contributions to super since a similar survey last year, and policy changes such as the abolition of the superannuation surcharge for higher income earners, along with recent personal income tax reductions, have contributed to this.

“Australian workers at the higher end of the income tax bracket have indicated that they are preparing to take advantage of the biggest tax reduction on superannuation in recent history,” he said.

The IFSA research revealed a very high level of awareness of the super surcharge – not surprisingly the highest level was among those who earn enough to pay it.

Mr Gilbert says the co-contribution scheme for lower income earners has “balanced” the super surcharge removal and has also initiated a positive response. “Some IFSA member companies reported that co-contribution inquiries to call centres in the last week of June were up by 50% to 70%.”