In 2007, in a cynical measure to tie up and buy the “grey” vote before the federal election, John Howard and Peter Costello abolished the Keating government’s Reasonable Benefit Limits in superannuation, which placed an upper limit to the tax benefits that could be obtained via the superannuation system.

To play to the “grey” constituency, Howard and Costello provided
unlimited tax benefits to be available from superannuation.

Those unlimited sums of income were then subject to tax only at the concessional rate of 15 per cent – where, under the Keating government RBLs, sums above the limits were subject to full personal rate taxation.

In other words, the Reasonable Benefit Limits placed a cap on what
otherwise would become a tearaway capital-accretion scheme........

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