For Immediate Release
Washington, DC – The ERISA Industry Committee (ERIC) today submitted comments to the Senate Finance Committee on retirement tax incentives in the context of comprehensive tax reform. The national trade association, focused solely on advocating for the employee benefits and compensation interests of large employers, encouraged the Committee and Congress to proceed with caution when considering any possible major changes to the very successful employer-sponsored retirement system.
Employer-sponsored retirement plans are available to an overwhelming majority of working Americans, and are helping them prepare for retirement. These plans are a key component of the nation’s retirement system. Changing the current tax treatment of employer-sponsored plans would likely jeopardize the retirement security of millions of Americans. Additionally it would also impact the role retirement assets play in the capital markets, and create obstacles for future generations of retirees.
“The current system involves a delicate balance between the needs of companies and their employees,” said Kathryn Ricard, ERIC Senior Vice President Retirement Policy. “Uncertainty surrounding the rules and regulations of retirement plans undermines the ability of employers to offer and maintain a plan, and risks undercutting the success of the system.”
The current voluntary employer-provided retirement plan system works well. A “one-size-fits-all” approach to rules and regulations will not address the challenges companies face when wanting to offer benefits to employees. With changes in work-life trends and a more mobile workforce, ERIC recommends that Congress encourage the sponsorship of defined benefits plans to better meet the needs of the country’s changing workforce.
“Employees do a better job of saving for retirement when an employer plan is available and our members provide comprehensive retirement benefits to tens of millions of Americans,” added Ricard. “We urge the Senate Finance Committee to preserve current tax treatment for retirement plans.”
The current retirement plan system should be maintained or enhanced. U.S. workers need flexibility, and it is critical that Congress recognize the value of the current system, which reflects lifetime savings habits. Congress needs to protect the retirement system to allow future generation to properly prepare for retirement.
You can read ERIC’s letter here.