Tasmania's largest multi-industry superannuation fund has announced its support for Federal Finance Minister Nick Minchin's call for the abolition of the 15% superannuation contributions tax in this year's budget.

According to Tasplan General Manager, Neil Cassidy, overwhelming support from the broadest possible range of interest groups is a clear indication of the merit of the Minister's proposal.

"How often do we see business, unions, most sectors of the finance industry and opposition political parties all endorsing a proposal being put forward by a Government Minister?" Cassidy said.

"The strength of feeling about Nick Minchin's proposal has a lot to do with the fact that ordinary Australians find it altogether inconsistent for any Government to urge them to save for their retirement - and then to levy a tax on their superannuation contributions."

Cassidy also believes that removal of the Contributions tax will act as a 'circuit breaker' and go a long way toward establishing in people's minds the credibility of the Federal Government's retirement incomes strategy.

"In other words, an Australian on an average income is far more likely to see superannuation as providing a real opportunity for them to achieve some degree of comfort and independence in their retirement." Cassidy said.

Tasmania's Senator John Watson, Minchin's Liberal colleague and former chairman of the Senate committee on superannuation said it would "ignite new interest in superannuation savings and retirement planning among Australians".

Cassidy says that we must not understate the significance of the Minister's proposal. The elimination of the 15% tax would ; -

- add $610 a year to the super account of a person on $45,000

- increase that person's retirement income by $30 a week

- deliver a benefit to 7.3 million people

"The last point alone makes the proposal a very important reform which will benefit an enormous number of ordinary Australians - as opposed to the selective tax relief that has been a feature of Budgets over recent times." Cassidy said.