AMP welcomes commitment to encourage savings
AMP says tax incentives is a step in the right direction.
Friday, February 8th 2002, 4:05PM
"AMP's research shows that 9 out of 10 people have got the message they ought to be saving, but less than half are doing anything about it.
"We have always argued that some kind of Government action is needed to kick-start private savings rate and the announcement today by National that it would introduce tax incentives to encourage savings is to be welcomed," Kent says.
"AMP supports a three pillar approach to retirement income — a Government safety-net pension, employer schemes, and voluntary private savings. The first component is in place with agreement about the age and level of entitlement to New Zealand Super.
"A rebate on contributions made to a long-term savings scheme proposed by National is a step in the right direction towards getting the other two pillars in place. While there are no details yet about the level of rebate or the cap on contributions, at the very least the policy should remove the current anomaly that sees low income people pay penalty tax rates on money they save."
Kent says that while he welcomed any commitment to encouraging private savings, AMP's preferred approach was a tax deferral scheme rather than a simple tax incentive. Under a tax deferral scheme all contributions to longer-term savings scheme would be tax free, but drawings would be taxed.
This is a press release from AMP.
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