Regardless of membership patterns, the exemption from ESCT for employer contributions will increase inequality; because this is capped as a percentage of salary rather than a dollar amount, higher earners benefit more from this incentive than lower earners (while non-earners and the self-employed do not benefit at all).
This tendency for the unequal incidence of KiwiSaver incentives to strengthen over time reflects the growing importance of the ESCT exemption as a source of benefit, and the diminishing effect of the one-off $1,000 kick-start payment over a longer time horizon.
All three of the KiwiSaver incentives considered (the $1,000 kick-start, the $1,043 matching contribution and the ESCT exemption) act to increase inequality (based on their positive values for I- the share of inequality due to each source).
Because the ESCT exemption will, over time, become a more important source of benefit, while the kick-start benefit is a one off, a longer-term perspective would be likely to find that the overall impact of KiwiSaver incentives on inequality is even greater than what is shown in Table 3.
In the simulation, the kick-start payment is a relatively minor part of the total incentive package, while the ESCT exemption becomes almost one-third of the total (up from one-twelfth in the first year).
However, the nature of our results suggests that such a concern is misplaced, because the largest contribution to inequality from KiwiSaver incentives is from the tax-free nature of the employer contributions, in the form of the ESCT exemption.
They first consider a 40-year-old whose earnings ($23,660) are only one-half of the weekly average, who at age 65 will receive a total value of KiwiSaver incentives and subsidies of $69,889, with $6,366 of this due to the tax exemption on employer contributions (the ESCT exemption).
This is especially because the most dis-equalising component of KiwiSaver incentives is the ESCT exemption, which was introduced in December 2006, with little fanfare and even less consultation (St John 2006), outside of the main announcements in May 2005 for KiwiSaver I and in May 2007 for the subsequent extensions of KiwiSaver II incentives.
4) The ESCT was previously known as the Specified Superannuation Contribution Withholding Tax (SSCWT).
Por ello, si bien los articulos presentados aqui no son exhaustivos de la produccion de ESCT de America Latina, si permiten hablar de algunas tendencias que presenta el campo.
Este numero es en ese sentido, una solida muestra de lo que son y han sido los ESCT en America Latina: inclusivos, situados, multi-vocales y plurales.