Australia: Govt axes mining tax, slows super

The coalition has delivered on its election promise to axe the mining tax but in the process is denying average workers about $100,000 in superannuation. Just days out from the government's first anniversary, a deal was struck with the Palmer United Party to deliver the votes necessary to pass the repeal through the Senate. 'We promised to get rid of it and we've delivered,' Treasurer Joe Hockey said of the deal, which will cost the budget $6.5 billion over the next four years. The reduction in budget savings will be recovered in the medium term by pausing the superannuation guarantee rate at 9.5 per cent until July 1, 2021. After this, the superannuation guarantee rate will increase 0.5 per cent each year until it reaches 12 per cent from July 1, 2025. Industry Super Australia called it a short-sighted deal which would cost a 25-year-old average income earner around $100,000 over their working life. Under the deal with PUP, the government has agreed to extend the low-income super contribution until June 30, 2017 and the income-support bonus until December 31, 2016. The schoolkids bonus will also stay in place until December 31, 2016, but will be means tested so that only families earning up to $100,000 will qualify, according to AAP.