Please note that these announcements are only policy and they have yet to be regulated or put into law.

The Federal Government has recently announced a plan for a price on carbon, referred to as the carbon tax. This has the potential to impact superannuation, income stream and pension members in a number of ways.

Self-funded retirees
The Government has announced that it will provide the same assistance to self-funded retirees who hold a Commonwealth Seniors Health Card as it will provide to pensioners.

Self-funded retirees and pensioners will receive an annual Clean Energy Supplement of up to $338 for singles and $510 for couples combined. They will receive the first nine months of assistance as an advance lump-sum payment, which equates to about three quarters of the annual payment. The advance payment will be made in May and June 2012.

All taxpayers with a taxable income of up to $80,000 a year will get a tax cut, with most getting a cut of at least $300 per annum. The Government has indicated that it will review the adequacy of assistance each year and will increase it further if necessary.

Changes in personal income tax rates
The Government is proposing to increase the tax-free threshold to $18,200 from 1 July 2012 and to $19,400 from 1 July 2015, in addition to the following tax rate changes:

Proposed changes in personal income tax rates

	Tax Rate 1 July 2012	Tax Rate 1 July  2015
Between tax-free threshold to $37k	15%	19%
Between $37k to $80k	30%	32.5%

Most low income earners will no longer be required to lodge a tax return as a result.

Impact on Investments
Members in defined benefit funds will not be impacted as investment results do not impact their retirement benefits.

Members in accumulation products may impacted by changes in the value of investments.

Substantial policy changes, like the carbon tax, may impact returns both positively and negatively as the relative valuations of assets adjust to take account of the impacts of the changes.

 As a core part of our investment principles we ask our investment managers and advisers to consider the opportunities and risks that environmental, social and governance factors present in our investment decisions.

More information
For more information about climate change and the carbon tax, please go to www.cleanenergyfuture.gov.au

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