ATO prices Coalition’s super plans

The Australian Taxation Office says it would cost taxpayers more than $250 million over four years for it to process superannuation payments on behalf of small business.

The Australian Financial Review reports that the Tax Office has advised the Government the Coalition’s plans would cost $257 million over four years, and $71 million annually thereafter, assuming one-quarter of relevant SMEs took up the service.

Assuming 800,000 employers with 20 or fewer employees qualify for the service, the cost would list to $368 million over four years, the report said.

Costs are expected to fall if the existing clearing house run through Medicare is transferred, although the ATO reportedly said it would need “significant lead time” to implement the Coalition’s policy.

The Council of Small Business Organisation of Australia last week welcomed the Coalition’s plans last week for the ATO to distribute super payments to relevant super funds on behalf of SMEs.

COSBOA executive director Peter Strong told SmartCompany it was the “first removal of red tape for the sector in memory.”

While Strong said the Government’s existing superannuation clearing house is not easy to engage, the Government says more than 4,300 employers have registered, with more than 84,000 payments made.

Small Business Minister Nick Sherry added that if the Coalition really cared about small business, he’d stop “mindlessly opposing our tax cuts for two million small businesses”.