22nd Mar 2018
How do franking credits work?
Author: Olga Galacho
australian stock exchange screen

On the simplest level, respected economist Saul Eslake compared the winding back of a cash refund for franking credits with slapping a tax on blue cars but not on cars of other colours.

That the mooted proposal by Labor leader Bill Shorten discriminates against investors who own shares was poignantly highlighted by broking house Motley Fool General Manager Scott Phillips. He illustrated the controversial policy to withhold tax paid on dividends thus:

“Consider three people, all of whom have self-managed superannuation funds in pension phase, and who – according to the current tax rules – pay 0 per cent tax: Banking Betty, Rental Richard and Dividend Davina.

Banking Betty deposits $100,000 into an account and earns $2000 each year in interest. Betty doesn’t pay any tax.

Rental Richard has a $100,000 property with a tenant who pays him $2000 each year in rent. Richard doesn’t pay any tax.

Dividend Davina buys $100,000 worth of shares that earned a profit of $2000. The company paid tax of $667 on her behalf, so Davina gets $1333. Davina doesn’t pay any tax.

See the difference here? Because Davina’s investment is in the form of shares in a company, she gets less than the other two. Even though she’s not supposed to pay any tax, the company (subtracted) tax on her behalf, so she gets less.

Under current rules, she’d get the $667 back (as a cash refund from the Government), delivering on the current policy of a 0 per cent tax rate, and equalising the return for each of those investors.

Bill Shorten, in effect, is penalising people for owning shares.”

What should be a straightforward process has now been dissected and analysed by so many vested interests that not only has the Opposition Leader backflipped somewhat after howls of protest, but the issue appears even more complex to the layperson.

Mr Eslake told YourLifeChoices that he believed the refund was no less inequitable than negative gearing, which is a boon for property owners who are able to write off losses from  owning investment properties.

He also agreed with analysis claiming that retirees on modest incomes were not likely to miss out on too much if they did not receive refunds.

“If these people are identified, it would be fairly easy for a government to make sure they were not worse off,” the independent economist said.

He said there were other solutions that could reverse a situation where those on modest incomes were penalised, and at the same time curb the ability of wealthy retirees to receive the cash refunds while avoiding tax on income from their superannuation.

“Caps could be put on the total amount of rebates from unused franking credits and they could apply to everyone,” he said. “That way, no individual can get more than they were notionally entitled to.”

Mr Eslake was scathing of the raft of tax concessions, bonuses and other benefits that had been created during the years in which John Howard and Peter Costello were at the helm. Among those concessions was a requirement that the Australian Taxation Office convert the franking credits into a cash refund for investors on a marginal tax rate of zero.

“Mr Costello also introduced an exemption that allowed Australians aged over 60 to withdraw huge amounts from their superannuation, tax-free.

“This dumb rule has given rise to the situation where you can collect a generous stream of income from your super fund, and because you don’t have to pay tax on withdrawals, in other words your marginal tax rate is zero, tax paid on your dividends can be refunded to you.

“Much confused debate has resulted from Mr Shorten’s idea because commentators, politicians and others are exploiting the fact that people are not understanding the difference between taxable income and total income.

“Australians are taxed on their taxable income, not their total income. Retirees over 60 years of age who are self-funded are considered to have no taxable income, because withdrawals from their super fund are tax-free.”

Since Mr Shorten announced his franking credits plan, he has continued to emphasise that retirees on modest incomes would not lose out on the tax cash back.

 

Opinion: Choose carefully which golden egg-laying goose to kill

It’s no surprise that average Australians, those still working and those already retired, are infuriated with revelations that wealthy, self-managed superannuation fund members are drawing a tidy, tax-free sum from their nest eggs and collecting big cash refunds from the taxation office.

But as explained over the past week by some experts, the real poke in the eye is not that dividend taxes paid by a company on behalf of their shareholders is refunded, but that some of those shareholders benefit greatly from other concessions applied to their total wealth.

Fairfax economics editor Ross Gittins says those concessions are growing at a much faster clip than the Age Pension payments and “robbing” the budget of forgone taxes.

So before killing the goose that lays golden eggs for very wealthy retirees, it is worth ensuring that you’ve got the right bird on the chopping block. That is, there are many other measures that can be wound back first to level the playing field for retirees.

Withholding franking credits from taxed dividends would likely not be a great leveller, because proportionately, it would hurt the hip pockets of less well-off retirees more than wealthy retirees.

Having said that, many experts joining the debate are saying that retirees on modest incomes will barely feel the sting of having their franking credits withheld because they just aren’t rich enough to own the number of shares required to generate large dividends.

“The tax-free threshold is $18,200, which means you would probably need a share portfolio worth around $1 million to create that size income from dividends,” says Paul Drum, the Head of Policy at peak accounting body CPA.

“If you own that amount of shares, you are hardly going to be a poor retiree,” he told YourLifeChoices.

“In any case, a smart investor will not have those shares outside of their superannuation fund. The smart retirees have their share investments inside super because when they withdraw money from their fund, it isn’t taxed at all.”

And there’s the rub – there are many lawful ways smart investors can dodge paying tax. Perhaps those strategies and concessions should be clawed back by governments first in a bid to ensure that the very wealthy are paying their share.

Refusing to hand back tax already paid by those on a zero marginal rate is not the way to fix the problem – the problem being that there are too many avenues the wealthy can take to avoid paying tax.

Do you believe shareholders are entitled to franking credit refunds? Do you think there are too many concessions for wealthy retirees?

All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances. 

Are you eligible for an Age Pension? Do you know your rights? The RetirePlanner™ tool has all the information your need. 

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    COMMENTS

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    Ok
    22nd Mar 2018
    10:38am
    We just heard that Australia has a 50 Billion Dollar black economy. Bill Shorten finds it easier to go after the elderly and steal from their hard-earned pension fund. We have a small SMSF and we will be hurt. We are not sure what to do, sell our Australian shares and buy shares in countries which do not regard anyone over 65 as a criminal? What will Shorten do next! A super tax on wheelchairs, a walking stick levy or will he start digging up graves to recover gold from the teeth of the deceased?
    Knows-a-lot
    22nd Mar 2018
    10:52am
    He's only going after rorters, levelling the playing field. Good on him!
    Kali-G
    22nd Mar 2018
    11:10am
    spot on comment!
    Cowboy Jim
    22nd Mar 2018
    11:18am
    By all means, sell your Aussie shares, Ok. But instead of buying others, spend the lot if you can on things that give you pleasure and join Knows-a-lot on his level playing field. Have done exactly that a while ago. You are still allowed to have some dollars and can collect a
    reasonable fortnightly pension.
    fred
    22nd Mar 2018
    11:27am
    Yes , Ok Bill Shorten is a thief and liar.
    It will not only be the wheel chairs, it will be your house that he will want you to sell , downsize and live off what's left after agents fees and stamp duty . At the same time he wants to take the exemption of income from tax in our superannuation funds , he has exempted the union base super funds , where is the fairness in that .. none and that's why I call him a liar
    So the retirees who saved and topped up their super with contributions that have been taxed at marginal rates or 15 % when going into accumulation , pay 30 % tax on the dividends before they are distributed will have the tax refunds cancelled . the whole purpose of superannuation was to provide tax free retirement incomes and that is commonly known , This pricicipal was the reason why taxpayers invested their life savings and hard earned into super funds Ok after Shorten takes the Gold from your teeth
    we still have our super balances required to pay 17 % extra witholding tax before it goes to beneficiaries Enough is enough of Aged penioners complaining when they get everything tax free and tax payer funded Ok probably best to spend the lot now and go on the Government teat
    OnlyGenuineRainey
    22nd Mar 2018
    1:22pm
    Sorry, Knows-a-lot, but you are sadly mistaken. He is NOT hurting the wealthy, who have plenty of means of circumventing the loss. But he IS crucifying poorer SFRs.

    Here's a REAL scenario. Homeowner retired couple are achieving an income of $37500 a year from superannuation assets just over the asset threshold. They get no pension, so the tax man gains some $36000 to $40000 a year depending on the value of concessions. $4500 of their income is in franking credits. Under Shorten's proposal, their income will reduce to $33000 a year, and they will effectively be handing the tax man up to $44,500 a year by the loss of franking credits plus loss of pension. Does that sound reasonable to you? How many people do you think would accept a tax of $44,500 a year on an income of $33,000?

    The strong incentive for these folks is to spend their super on a bigger house and claim a full pension and that will hardly be good for the nation. There are thousands in this situation.

    Furthermore, the policy will hit EVERY Australian worker whose tax rate is less than 30% - but NOT the majority of those who pay more than 30%. So it's a tax ON THE POORER - NOT THE WEALTHY.

    It's been cleverly designed and dishonestly but convincingly presented, sadly. Please don't believe the lies.
    Jim
    22nd Mar 2018
    2:40pm
    It's amazing even after reading the article people still think pensioners are rorting the system, I wish someone could make it clear to all. Here is my situation My wife and I have a few shares, twice a year we get paid a dividend, on the statement I get there are two amounts, one is the dividend I receive the other is the franking credits that I don't receive, the franking credits are the amount the company pays the government in tax on my behalf, at tax time when I have to declare my income I have to include both amounts even though I haven't actually received the franking credits because they have gone to the government as my tax liability on the income I have earned on my shares, now when I do my tax my total income from all sources including my pension is less than the tax free threshold, so I am therefore entitled to a refund of the tax I have paid through my franking credits, just as any other tax payer is allowed to do. My refund is usually between $250/$300 this is the amount Shorten wants to take from me. So if anyone thinks this is fair, you would have to also agree that all tax payers who have paid tax during the year but then end up with an income lower than the tax free threshold should not receive any of that tax back.
    TREBOR
    22nd Mar 2018
    6:06pm
    You got it, Jim.
    MICK
    22nd Mar 2018
    8:07pm
    Good comment OK. Maybe mention that the current government is the one which has come after retirees with a vengeance, not Shorten.

    I would be very surprised if SHorten did not tweak this policy to be fairer to those earning zilch. Once that happens the policy will be spot on.
    OnlyGenuineRainey
    22nd Mar 2018
    8:08pm
    It amazes me more, Jim, thaqt after reading all that has been written some people still think the SFRs who worked their guts out and paid hefty taxes to DONATE $36000 a year (if a couple) the taxman are ''rorting'' by asking for their OVERPAID TAX to be refunded.

    How much more do these greedy selfish monsters want to take? While they happily justify claiming a pension, saying they are 'entitled'' (I agree, by the way!), they are happy to see SFRs deprived of BOTH the pension AND a fair refund of OVERPAID tax.
    VeryCaringBigBear
    24th Mar 2018
    1:08pm
    You make no sense OGR as your home owning couple would get very little OAP even if they were just below the asset cut off point. They could only have $380,500 to get full pension. If they have even a little more than $837,000 then they are badly invested if they only earn $37,500. That's only a return of less than 4.5%. They would be earning nearly twice that if well invested. If they had $500,000 invested in fully cranked equities they would lose about $15,000 if their franked credits were not refunded.

    My biggest problem i s keeping under the threshold to keep my full pension as I earn more than
    I spend.
    OnlyGenuineRainey
    24th Mar 2018
    6:40pm
    BigBear, the average investment return is 5% - government figures. Take costs out of that and it's easy to get down to 4.5% - or less. Of course those just under the threshold get very little pension. That's not relevant to the argument that those who sacrifice pensions to be self-funded or largely self-funded are being OVERTAXED.

    You seem to think that if someone is honest and ethical and contributes to the nation's wealth, but is poorly invested (probably due to inherent disadvantage limiting their knowledge or capacity to tolerate risk) then it's okay to steal their savings. But if they are happy to be dishonest and manipulative, then they should get a benefit. No wonder the country is stuffed!

    But my point is that if Shorten's GROSSLY UNFAIR TAX is implemented, more people will do what you are doing and there won't be any savings. The cost of the OAP will skyrocket and eliminate any tax savings, and the tax savings will disappear anyway as people move to other investments.
    VeryCaringBigBear
    25th Mar 2018
    7:28am
    Gee so those super fund figures with returns of about 10% were bogus. I don't think so as I earn more than that on what I have invested myself so much so I have trouble staying under the threshold to keep my full pension. Just booked another overseas trip for my grandkids.

    Personally I doubt Shortens proposal has any kegs at all so I'm not worried about it at all. I do however wish the media would employ someone that is economically literate on how franking credits work instead of the garbage they are publishing about it.

    Just with what I have invested I receive a refund of about $5000 in franking credits each year. So you don't have to much money invested well to lose on this proposal. It would not surprise me that many people would not even realise what was in their tax refund cheque.
    OnlyGenuineRainey
    25th Mar 2018
    6:37pm
    Members of retail and institutional super funds are complaining that they don't get franking credits and saying they didn't know, until now, that they should. Of course they ARE. They just can't see them. So hundreds of thousands are stupidly supporting Shorten's proposal believing his BS about it hitting the wealthy when they themselves will be hurt by it and are not even literate enough to know that.

    If you booked another trip for your grandkids, BigBear, the money should be counted as an asset for 5 years. You can't just buy gifts to stay under the threshold. But clearly you have no conscience about cheating any way you can. The sad thing is that more and more are being pressured to cheat and manipulate as you do because everyone is attacking SFRs who are honest and ethical, demanding they be stripped of their savings.
    VeryCaringBigBear
    25th Mar 2018
    10:34pm
    No problem booking a trip for my grandkids with Centrelink as long as you do it by the rules.
    OnlyGenuineRainey
    26th Mar 2018
    8:31am
    What rules allow you to GIFT to your grandchildren and it not be counted, BigBear? NONE. There is a very tight limit on gifting and over that you lose pension entitlements for five years.
    Old Geezer
    26th Mar 2018
    12:54pm
    Well I don't have any problem with my grandkids using my travel account and Centrelink don't either.
    Farside
    26th Mar 2018
    2:26pm
    @VeryCaringBigBear and OG, can you tell more how to you can gift to grandkids without falling foul of Centrelink. Is travel a special category? Both of my parents want to gift the grandkids to give them a hand up but are understandably cautious.
    Old Geezer
    26th Mar 2018
    3:18pm
    I give away lots of stuff but don't have anything to do with Centrelink.
    VeryCaringBigBear
    26th Mar 2018
    9:00pm
    The rules state that you can spend money on anything that benefits you. Making my grandkids happy benefits me so it is not a gift.
    Knows-a-lot
    22nd Mar 2018
    10:51am
    It's clear the rich are getting away with blue murder. All power to Mr Shorten!
    OnlyGenuineRainey
    22nd Mar 2018
    1:22pm
    WRONG WRONG WRONG WRONG WRONG, Knows-a-lot. This is going to hurt poorer Australians badly. The rich - no problem. They'll just restructure their affairs to recover the loss
    Cowboy Jim
    22nd Mar 2018
    2:04pm
    Not to worry OGR - Knows-bugger-all is still dancing with Electricity Shorten on his level playing field.
    Kathleen
    22nd Mar 2018
    4:53pm
    Knows-a-lot, you and Trebor are amongst the few who are making any sense. People are either being emotional and talking rubbish or abusing other people commenting. Labor is looking into any hardship that may be done to pensioners any way. They have proposed a policy beating LNP to the punch and now they are sifting through people’s reactions and checking if there is any hardship being caused. There are pensioners renting and even homeless so they need to be helped first. No one is to be forced to live below the pension amount which they have said over and over. There could be some LNP people on here paid to stir as they are on Facebook. People need to do their own research and not be like Trump voters who believed every bit of rubbish that helped put him in the White House which the world now has to deal with.
    Jim
    22nd Mar 2018
    5:15pm
    There could also be some labor people on here doing exactly what you are suggesting, the whole argument is whether the tax paid on shares should be allowed to be claimed back if your income is below the tax free threshold, anything else being commented on is to misdirect that argument and is a ploy used by all political parties to divide people, and in this instance they are doing a great job.
    Anonymous
    22nd Mar 2018
    5:38pm
    Knows-a-lot - you know absolutely nothing! Short-on ideas know even less than you! His plan is going to hurt hundreds of thousands of 'little guys' and the big guys will work out an effective strategy to circumvent his attack, anyway. How many small share holding, older Aussies will liquidate their share holdings (classed as an asset by Centrelink, in terms of calculating OAP entitlement), blow the proceeds on expensive holidays, and then be eligible for higher OAP payments, because they have reduced their asset base? The net effect is that the cost to the taxpayer will increase, and the budget deficit blow out further. I see/hear he is now backtracking a little, because this scenario has been brought to his attention. Well why not think it through in the first place, before scaring the horses?
    OnlyGenuineRainey
    22nd Mar 2018
    5:54pm
    Kathleen, you are a lovely person and have a good heart. That's clear. But you are sadly mistaken. This policy will RUIN Australia. And you are wrong about who it hurts. It will force thousands more onto pensions by reducing their income to the point where they are paying 150% or more to the taxman and their income is well below the aged pension. It will hurt all working Australians who pay less than 30% tax. They are NOT the rich. The rich WILL NOT HURT. Most of those earning enough to pay over 30% tax will NOT suffer.

    No, that's NOT LNP propaganda. I don't support the LNP at all. I wanted to vote Labor, but this proposal will destroy the nation.

    Yes, we need to care for the homeless and the very needy first and foremost. To do that, we need a HEALTHY ECONOMY in which people can afford to spend to stimulate growth and jobs, there are incentives to strive, and people can afford to pay the taxes that facilitate a strong welfare system. What Shorten is doing is wiping out all the benefits of working, saving and planning, reducing ALL retirement savings for lower income earners, increasing demand on the pension, and redirecting investment away from Australia or into property.

    We need PROSPERITY, and Communism doesn't deliver it. Neither does misplaced socialism. We need RESPONSIBLE CAPITALISM - a strong tax and welfare system with integrity and fairness, and a strong incentive to work, save, plan and invest. That will NEVER be achievable while those who work and save are pushed into hardship with GROSSLY UNFAIR TAX POLICIES.

    Like the man said, it's like taxing everyone with a blue car and not those with a red one. We NEED investment in Australian companies. If we drive investors away, wrongly thinking we they have too much and need to be punished for their success, we are driving away all opportunity to return to prosperity, and we are condemning future generations.

    I care too much for my grandchildren to let fools stuff up our country with dumb socialist policies. I'm really sad that you can't understand what harm you are doing to younger Australians by letting a communist attack break drive economic decline.
    VeryCaringBigBear
    22nd Mar 2018
    6:05pm
    If I earn $20,000 a year I pay no tax but I get a refund of $5000 in franking credits. If I earn $100,000 my tax is $25,000 but I have $5000 in franking credits so I pay $20,000 in tax.

    Shorten wants to not give the refund of $5000 to me if I earn $20,000 but takes $5000 off my tax if I earn $100,000.

    Now if you think that is fair you have rocks in your head.
    OnlyGenuineRainey
    22nd Mar 2018
    6:17pm
    Thank goodness for someone with a brain at last. But I despair of some of those blinded by envy seeing past the trees and into the wood.

    Wake up Australia. This policy will hurt the POOR - not the rich. Like most underhanded schemes politicians cook up, it's a gross deception intended to give their rich buddies a benefit while conning the nation into thinking they are doing good for the common man.
    Kathleen
    22nd Mar 2018
    8:06pm
    Jim, people are telling other people who not to vote for! There is a thread about elections flowing through here. People do not even know what will happen. They are guessing. Why not wait to see actually will occur rather than guessing and panicking and spreading panic. Much more water to flow under the bridge before anything will be passed into law.
    OnlyGenuineRainey
    22nd Mar 2018
    8:20pm
    Kathleen, it would be helpful if Labor stopped hiding their policy and economic workings. Then we might know where we stand. At present, a lot of people are justifiably frightened. They have been hurt badly by cruel changes to the assets test and they are struggling. They fear a further attack.

    And it doesn't help when people like you imply that they are ''rorting'' and/or support Shorten's attack.

    How selfish can some people be? These folk worked their guts out and paid hefty taxes to be in a position to DONATE $36000 a year, or more (for a couple) to the needy by not claiming a pension. Now, despite their very low incomes, some very selfish folk want the government to take MORE. 30% More than other retirees pay in tax. 30% more than the law says retirees should pay. 30% more than is fair. In some cases much, much more than their earnings. effectively forcing them to GIFT all their hard earned savings to the government to hand to people who, in some cases, are far better off and enjoyed a better lifestyle but manipulated to claim a pension.

    Ultimately, these people are supporting pensioners. And a lot of greedy, self-serving pensioners are screaming for their blood. Why? Oh, ''because it's not FAIR that they should have savings and we don't''. Well it's not FAIR that pensioners should get a handout of up to $1 million while workers and savers are tormented and deprived.

    Many SFRs support pensioners in their claims of entitlement AND their calls for a better deal. The least these pensioners could do is show appreciation for the sacrifice SFRs made to help the nation's budget and STOP BLODDY YELLING FOR MORE. You are being brutally unfair and cruel. They have given enough. They deserve to be left alone to enjoy the income they earned TAX FREE, LIKE THE REST OF WORKING CLASS AUSTRALIANS.

    (Please note, I'm not talking about the rich. I support taxing high retirement incomes. But working and lower middle class retirees should NOT be overtaxed just because a large portion of their income comes from share investment. After all, investment in Australian shares is GOOD for Australia. And Shorten's policy - as it's been presented to date - will strip poorer SFRs and part pensioners of their income and tax them unfairly. So if you want people to ''wait and see'', show a little support for them and stop supporting attacks that are generating fear.)
    VeryCaringBigBear
    25th Mar 2018
    7:43am
    Knows-a-lot I get the full OAP and to get it I have to stay under $380,000 in assets. Now as I don't want to get 2% on my money at best I invest $300,000 in bank shares instead. My biggest problem here is if my bank shares go up not down as I lose part of my OAP. Now I earn 9% (It is currently closer to 10%l) which gives me a grossed income of 27,000. That includes franking credits of $8,100 that are refunded to me. If I only had $100,000 invested my franking credits would be $2,700.

    So instead of having my money invested badly on deposit and earning $6000 I invest it in the bank instead and earn $27,000. No tax is paid as I am under threshold being a couple. However if I now don't get my refund of $8,100 I am paying tax of 30% on my income of $27,000 and only receive $18,900 of that income.

    IF you think this is fair you have rocks in your head.
    Seadove
    22nd Mar 2018
    11:06am
    I think the three examples are skewed - firstly if you invested $100,000 in to super your return would more likely be $12,000 (not a bad return). The second example for him to get the miserly return of $2000 on that investment he would have to charge a weekly rental of $40 per week (a ridiculous investment return). The third example, did Davina knowingly put her money in to private shares because of the double dipping arrangement and by choice not putting it in to a super fund from which she could draw a pension then that is her bad luck. I can't afford to own private shares and neither can any of my friends who are all on the aged pension so to me it is only the wealthy that this will affect. No one has said that they still have their original investment of the shares and the dividends they get so they are jumping up and down about a rort that Howard/Costello brought in to help their mates and thus trying to buy votes. Use the superannuation arena as it was meant to be used and this won't have any implications on you at all.
    Jim
    22nd Mar 2018
    3:01pm
    So the politics of envy strike again, just as Shorten wants to perpetuate the myth of the rich pensioners, I get a tax refund of about $250/$300 this is the amount that I have paid to the government as my tax liability for the earnings on my few shares, my total income falls well below the tax free threshold, so like any other tax payer I am entitled to claim that tax back, why are so many people on this site trying to demonise the pensioners that are receiving this legitimate refund, just as any other tax payer is entitled to do. I can only assume that it is jealousy that some pensioners are getting a few hundred dollars more than others, here's a suggestion, go out and do a bit of work just for a few months a year, once you have payed a few hundred dollars in tax stop working, make sure you don't earn over the tax free threshold then at tax time you can claim the tax back that you have paid, so you will end up with a few extra bob each week you are working, then at tax time you will receive a nice little amount back, just as I do from my earnings from my shares.
    Rae
    22nd Mar 2018
    3:35pm
    Seadove you could afford to own private shares if that was what you chose to spend money on. You chose to spend on other things instead.

    And Superannuation averages around 5.9% so the return on each $100 000 is just short of $6 000.

    If a couple your pension and discounts would have cost you around $700 000 so you are wealthy except the taxpayer is forking out your returns while the SF retiree you are dumping on chose to save that money for themselves because the Government convinced them it would help and the government lied.

    The examples were purely so you'd realise the tax had been paid already by someone who didn't have to pay any.
    Seadove
    22nd Mar 2018
    5:42pm
    I am not in a couple Rae, I am on my own and for twelve years I was working two jobs, seven days a week to keep my head above water so whatever I am pulling in a part pension has been well and truly paid for by the extra tax I had to pay for working the two jobs. Have any of you worked two jobs just to stay afloat, I'm thinking not. Do not demonise us battlers saying we are getting welfare when we have well and truly paid our taxes over our entire working life. What I chose to spend my money on was food, bills, petrol, utilities and bringing up my son so no Rae there was no leftovers for buying shares. I do not smoke, I do not drink and I certainly do not do drugs. If you think that going to the cinema occasionally is choosing to spend my money on other things then you are a hard arse. Not sure which super fund you are looking at but mine averages out at 10% for the last five years, the little bit I have in there. If people chose to buy shares outside of super then you take the risk which is now coming back to bite.
    OnlyGenuineRainey
    22nd Mar 2018
    6:05pm
    Excuse me, Seadove. I'll match you any day of the week when it comes to working my guts out for very low wages and struggling and going without to save. But I managed to achieve enough that if I stop work I would be barely self-sufficient - and paying ONE HUNDRED AND FIFTY PERCENT TAX UNDER SHORTEN'S BULLSHIT SCHEME.

    Yes, you worked for your pension. So did I. But I can't get one. I am robbed of the pension I worked for because I went without a great deal to save. Now I'm being robbed of my tax credits as well. Simple solution though. Just buy bigger house or give my savings to my kids and claim a pension. Why should I bust my gut to be self-sufficient while pensioners abuse me and want me robbed, overtaxed, and cheated out of everything I worked for. And they are really, really silly, because forcing more like me onto pensions will raise the cost of the OAP and reduce the chances of it being increased.

    Pull your head in, Seadove. You are NOT the only hard worker in this country, and you are demonising other workers who are actually HELPING you and your ilk by staying OFF the pension. You want them deprived of their livelihood and forced onto pensions. That's DUMB. Sorry!

    And BTW. If you have super, you HAVE SHARES and YOU WILL LOSE INCOME. Wake up! Shorten is short-changing YOU, but he's a smooth talker and obviously you can't see through his lies.

    This is nothing to do with people buying shares outside super. It will impact ALL shareholders on lower incomes. Those most likely to escape hurt are the wealthy, because they can rearrange their affairs to adjust. (And just by the way, if I'd bought my shares outside super, I wouldn't be losing. It's because they are INSIDE super that I will suffer a massive loss.)
    TREBOR
    22nd Mar 2018
    6:08pm
    Ah had to pay.. PAY mill owner to go to job!!
    OnlyGenuineRainey
    22nd Mar 2018
    6:24pm
    I'm still working and earning, so if I had bought shares outside of super, I could claim my franking credits to reduce my tax bill. Since they are INSIDE super, I can only claim about half my credits.

    When I retire, my income will fall from moderately comfortable to well below aged pension level and my tax bill will INCREASE by $4500 a year unless I sell out of shares and stop investing in the growth of Australian businesses, diverting instead to foreign investment.
    VeryCaringBigBear
    25th Mar 2018
    7:50am
    We are on a full OAP and own about $300,000 in fully franked shares and get a refund of about $8000 in franking credits. So it is a fallacy that those on full OAPs can't own shares.
    OnlyGenuineRainey
    26th Mar 2018
    8:33am
    Either you are assessed under grandfathering provisions, or you are cheating, BigBear, because you DO NOT get a full pension with $300,000 in shares - even with no other assessable assets. The reduction isn't huge, but there IS a reduction. I ran the C/link calculator today to verify. You are below the assets limit, I think, but deeming applies to reduce the pension under the income test.
    VeryCaringBigBear
    26th Mar 2018
    12:30pm
    OGR that is why deeming is so good for those who use it well. I am deemed to earn a max of 3.25% no matter how much I earn. As I have a partner we each get some of our assets deemed at a very low rate but can earn as much as we like on them.

    We get the full OAP each.
    OnlyGenuineRainey
    26th Mar 2018
    8:51pm
    You are obviously cheating, BigBear. I know all about deeming, but with $350,000 in assets you DO NOT GET A FULL COUPLE'S PENSION. Near full, but NOT full - unless you are claiming single pensions (which is probably the case given what a cheat you are!)
    VeryCaringBigBear
    26th Mar 2018
    9:13pm
    We can have $380,500 in assets before own OAP is reduced. So as long as we are under than twice a year on our review dates we are playing by the rules. That is then deemed and is below our real income.

    Looks like Shorten will be backing down on this and all pensioners will have their franking credits refunded.
    Kali-G
    22nd Mar 2018
    11:09am
    As long as Australians fail to realize that Labor = equals COMMUNISM, than these evil anti-establishment Socialist will dupe most people in to believing in them!
    Time to rid us of all left wing politicians!
    Nowhere in the world has communism worked, so why do they think it will work here.
    TIME TO DELETE all Socialists from politics.
    We should have a TRUMP!
    Seadove
    22nd Mar 2018
    11:26am
    I'd hate to see the kind of world you want to live in Kali-G. I didn't vote for either of the main parties at the last election but I know that politics from the centre is a much better option that what you are espousing and no we do not need another Trump......
    TREBOR
    22nd Mar 2018
    11:30am
    Trump is a socialist of a kind - so are the Liberals and even the Nationals. EVERY viable government has a combination of socialism and capitalism - and it is only when one or the other gets out of control that things go off the rails.

    Besides - communism and socialism have nothing to do with one another - communism is just another example of a society ruled absolutely by a self-appointed elite, the same as any laissez-faire capitalist society is - socialism is between the two and acts as a moderating influence on both.

    Trump is by no means returning his nation to the good old days of the company store and blatant exploitation of workers for a pittance and a life of pain, misery and early death - he is working on restoring industry and such so as to BENEFIT the working classes, and thus businesses local etc - a clear example of trickle-UP to the middle classes rather than of waiting for the Godot of trickle-down from the 'upper' classes.
    fred
    22nd Mar 2018
    11:38am
    yes Kali-G , Shorten and the unions are communists and socialists Wake up Australia they will have your house soon
    TREBOR
    22nd Mar 2018
    1:22pm
    It's been the Communist LNP that's been pushing for pensioners to down-size and thus incur a 'centrelink debt' for having too much, and who've been pushing for people to expend all their assets before getting the pension they already paid for.

    Bloody Communists the lot of them - at least Trump is a National Socialist, who puts Nation before Internation and utilises Socialist principles to set in place needed change in economy and society.
    OnlyGenuineRainey
    23rd Mar 2018
    7:19am
    Yes Trebor. Labor always was communist, and now the once capitalist LNP has turned commo as well. We are stuffed!
    TREBOR
    22nd Mar 2018
    11:25am
    Again - wait a minute.

    It seems to me that this is misleading - the examples given are of very small shareholder returns = $2000, and the intent and aim of Shorten's posited idea (that one he seems incapable of selling) was to catch the big ones who 'should' pay more tax than the company pays on shares, i.e should be paying MORE than 30% on income - and it is only those who would be caught by Shorten's scheme, and the rest would still get a return.

    The difference is primarily that the big tax payers can reduce their tax burden by use of creative accounting etc, and there lies the real issue with shares.

    Surely this could be viewed in another way as well - you could simply say this is a case of personal choice in where and how you invest - same as you accept a job that pays less than another for whatever reason, or pursue a career path that is not as remunerative as something else. Caveat Emptor.

    Equalising income from investment in this ways seems to me the ultimate form of socialism, when the entire idea of investment is steeped in capitalism. For example - if I invest $100k in shares in a venture and it fails, do I get a guaranteed return?

    That's a big NO. And yet that is the logical extension of all support of shareholding - every dollar put into shares of any kind, to be treated equally, needs to be guaranteed a return the same as every other. Obviously this is unsustainable and flies directly in the face of capitalist enterprise, and renders shareholding just another socialist government business with all shares rendered of equal value regardless of all other factors (shades of the old Soviet 'every worker is paid $10' regardless of all other factors thing that did the rounds years ago - hello!).

    I had another point to finish with there, but a combination of headache and rambling on above has lost it for the moment.
    Anonymous
    22nd Mar 2018
    11:34am
    Hopefully Turnbull gets his corporate tax reform bill passed and corporate tax rates drop to 20%
    Up yours Shorten
    TREBOR
    22nd Mar 2018
    11:36am
    More opportunity to profit-shift and offshore so no tax is paid here.

    Not a good idea when most don't end up paying the going company tax rate now.
    Anonymous
    22nd Mar 2018
    11:49am
    More dividends to the shareholder and less for the lefty loonies like Shorten to steal
    TREBOR
    22nd Mar 2018
    1:23pm
    Somebody calculated that a drop in company tax would result in lower dividends.....

    I'm interested to see your working....
    Rae
    22nd Mar 2018
    3:42pm
    If this starts mucking with shares the companies will simply stop dividends, invest in the company or buy back shares and the cash will be classed as capital gain and discounted by 50%. It's a slippery slope and Shorten is foolish even going there.

    People will be very annoyed if a sell off before the election causes rumpus to their Superannuation. Fooling with the Markets is dodgy indeed.

    I'm thinking of moving out of the ASX into International markets with less sovereign risk and I expect it's on a lot of investors minds now.
    OnlyGenuineRainey
    22nd Mar 2018
    6:33pm
    Yes Rae. My partner is pushing to sell all our shares and managed funds and move into property and precious metals.

    We are sliding down the slippery slope fast, and both LNP and Labor are making sure the slide is steep and rapid.
    VeryCaringBigBear
    26th Mar 2018
    8:33am
    Corporate tax rates will drop to at least 15% and companies will decrease their dividend pay out rates so a lot of the proposal gains will not eventuate. Companies will start issuing bonus shares in lieu of dividends to those who can't use the franking credits as well. Not much to be gained here Bill so you better start looking elsewhere.
    VeryCaringBigBear
    26th Mar 2018
    8:49am
    It will take a little bit more work but I will just turn my dividends into capital gains and not worry about getting my franking credits back.

    Capital gains are tax free if super is in the pension phase too.

    22nd Mar 2018
    11:28am
    What are these “too many concessions” for wealthy retirees ?????
    It’s the same bloody concessions available to all
    In fact retirees who do not have sufficient super are the ones getting welfare handouts and discounts all over the shop
    TREBOR
    22nd Mar 2018
    11:35am
    Put simply -it is the taxation regime that permits profit-shifting from one source of revenue to another, rather than viewing each profit in isolation, taxing it first, and only allowing deduction for re-investing the capital left over after tax.

    ONLY the wealthy can afford to have profit-shifting, along with the creative accounting that goes with it.

    And at every step, where these wealthy retirees have control, even by proxy, of companies etc, these wealthy accrue benefits such as freebies, travel, cars, drivers, and so forth and even cash - none of which are available even as tax concessions to the ordinary working person or the ordinary retiree.

    How do you imagine Kerry Packer could have a taxable income of $25k and live as he did and spend/invest a million a week at the races?
    Anonymous
    22nd Mar 2018
    11:46am
    Trebor - thanks for the Tax Avoidance 101 lecture

    However specifically - what “concessions” are available to the wealthy ?????

    Besides the $100k p.a nonconcessionl super top up , I don’t see any

    And my point is , the less wealthy are given pension handouts and a host of other benefits
    TREBOR
    22nd Mar 2018
    1:24pm
    Once you get past the idea that pensions are a handout, you may begin to have a point.

    Your politics of envy is showing... obviously you feel some are getting a free ride while you are not.....
    OnlyGenuineRainey
    22nd Mar 2018
    1:32pm
    Trebor, objective analysis reveals that ALL working Australians whose tax rate is LESS than 30% will lose under this proposal as will poorer self-funded retirees. Those who pay more than 30% - higher income earners - will NOT lose. It's NOT what is being presented by the lying Labor Party at all.

    Read my post about the couple with an income of just $37500 who will lose $4500 a year, and end up with $33000 in income while handing the tax man $44,500 a year by forfeiting a pension and paying unfair tax on their share income.

    This proposal is WRONG on every level. Politics of envy? You bet. With false and fraudulent claims that people who own shares are rich. Countless thousands rely on dividend income to survive retirement either without a pension or on a part pension. Almost all employees have shares through their super. ALL WILL LOSE. And experts have calculated that the tax saving will evaporate within 2 years and within 5 years the change will impose a cost due to heavier drain on the pension system and less spending.
    Rae
    22nd Mar 2018
    3:45pm
    TREBOR that handout would cost you around $700 000. So theoretically every pensioner couple have been handed savings of $700 000 when the rest of us saved the money ourselves and now get accused of being "wealthy".

    How come we get nothing ever?
    Sundays
    22nd Mar 2018
    4:10pm
    OGR, I agree that Labor’s proposal will adversely affect pensioners and part pensioners and it has not been thought through properly. However, your couple with a draw down income of $37,500 are choosing to only draw down this amount, to presumably preserve their capital. I don’t feel sorry for them. Also, it is ridiculous to continually refer to the money that they are missing out on because they don’t get the OAP. They don’t qualify, just as I don’t qualify for other benefits like Family Tax Benefit, but I can’t say I’ve saved the Government money because they don’t have to pay it to me. Now I will sit back while you start screaming at me
    With your upper case posts. Remember, the Asset thresholds were changed by the Liberals and the Greens.
    TREBOR
    22nd Mar 2018
    6:22pm
    That's if all dividend imputation is included.... I understood Shorten did a little back-step there and sought to cover that. It's part of the strategy a party uses....

    Hit 'em BIG... if they react against it, fall back to your second spot... if that doesn't carry - move to your third position.... and so on.

    As I said elsewhere on this discussion - you need to look down the road a few steps for what they are actually aiming for.
    OnlyGenuineRainey
    22nd Mar 2018
    6:50pm
    Sundays, of course my couple can draw on their savings. By doing so, they are effectively gifting all the holidays, restaurant dinners, new clothes, new cars, nice furniture, etc that they went without to save to people who lived a better lifestyle but didn't save. How is that fair or reasonable? They have a RIGHT to their capital, because they went without to save it. They should NOT now have to pay 150% tax because they were responsible and diligent, while those who weren't enjoy handouts. And if people find they are handing all their savings to the taxpayer and getting no gain, they will stop saving and investing and all go on the pension. I wish pensioners good luck then!

    And yes, they ARE saving the government by not claiming a pension. Every $36000 a year that does NOT have to be paid because someone saved to self-fund is benefiting the nation. But apparently selfish green-eyed monsters want to stuff the country by ensuring that nobody has a reason to work or save, and everyone understands that it's far more beneficial to live it up and put your hand out.

    Yes, I know LNP and Greens changed the assets thresholds. That's why I say we are all doomed. I wanted to support Labor, hoping they would offer more responsible management, but they are worse. They are finishing the job the LNP started. And I doubt it's because they are stupid. I'm betting there's a sinister motive that is driving them to WANT to wreck the economy, and they are just cleverer than the LNP in disguising their evil deeds.
    Sundays
    22nd Mar 2018
    8:36pm
    Your view of saving, and going without, to then get to retirement and continue to deny yourself is not shared by everyone. I know plenty of retirees who are happily spending the kids inheritance. It’s their money and they can do what they want. In this instance these people are no different to those who spent up big along the way. In fact, for many paying off the mortgage, educating the kids while saving what they could was all about enjoying retirement. Its not a new concept and not influenced by the Government changes. This is where green eyed monsters exist as people watch their friends going out, and having lots of holidays. It’s probably one of the reasons the asset threshholds were changed even though I agree they got it wrong.
    OnlyGenuineRainey
    22nd Mar 2018
    8:43pm
    Sundays, we didn't plan to save to go without in retirement. We saved planning to be comfortable in old age and have money for health care and aged care and home maintenance and home help - and yes, some to enjoy. What upsets me, and many, is that having planned in accordance with the laws, we are now cheated of all that we saved for. Why is our lifestyle choice any less valid than that of those who chose to spend more earlier in life? Why should we be robbed now of our savings while those who spent more get handouts?

    And please don't tell me about paying off a mortgage and educating kids. I did that, AND paid out in excess of $100,000 (in the early 70s, when that was several houses) in medical bills for a child. And I did all that AND saved on a single minimal income. But now greedy selfish pensioners who lived it up want me deprived of all that I earned by that sacrifice and call a refund of my overpaid tax a ''rich man's rort''. Disgusting!
    fred
    22nd Mar 2018
    11:36am
    Kali _G yes the Bill Shorten tax grab om imputation credits plan is pure communism and many labour politicians are ex union socialists beholden to the current union leaders hell bent on capital distribution and wasteful government spending with higher and higher taxes , as for the Greens they just give our taxes and money away for no return . What great alternatives we have
    TREBOR
    22nd Mar 2018
    11:37am
    Reality Check - bizarre when you note that it is the incumbent government that has raised the national debt by twice and a bit..... for nothing but rising costs to the consumer and a lowering standard of living.
    fred
    22nd Mar 2018
    11:40am
    total garbage Trebor .
    Rudd , Gillard , Rudd stuffed it and spent it before Abott came in , Your memory is very selective
    Seadove
    22nd Mar 2018
    11:57am
    and your response fred is typical of the right wing crap that comes out of LNP voters. Even after being in power for six years they still blame Labor because that's all they've got, they don't have any outstanding policies to talk about so it always comes back to Labor bashing. Always has been that way and always will be.
    TREBOR
    22nd Mar 2018
    1:25pm
    You can't get people to look at simple facts and figures sometimes...
    OnlyGenuineRainey
    22nd Mar 2018
    1:38pm
    And your response, Seadove, is typical of the ignorant and unthinking rusted-on Labor supporters and green-eyed monsters. Fred is right. You are wrongl This will NOT hurt the rich. It will stuff the retirement of poorer self-funded retirees, forcing them onto the pension, and it will hurt every Australian worker whose marginal tax rate is below 30%. The extra pension costs from crippling SFRs will cancel a lot of tax saving, and the drop in spending will stifle growth which will reduce jobs and tax revenue. Enjoy poverty mate. Your heroes policy will guarantee a lot of Australians suffer it. And watch the deficit GROW AND GROW AND GROW.
    TREBOR
    22nd Mar 2018
    2:19pm
    But if your marginal tax rate is less than 30% you will still receive a refund....

    Abolish dividend imputation and let the company pay its own taxes and the individual pay theirs.

    Too complicated... and I was lead to believe by discussion here that the reason for dividend imputation was to preserve 30% of dividend against company failure or malfeasance. So if you receive your 70% - and that 30% extra did not add up to a taxable income - you lost nothing.

    I can't see how your taxable income would rise above the income tax level, OGR.... why is your income not split in a partnership of husband/wife (don't use those terms near QANTAS) if all your income is derived from personal strands?

    Half of $37500 is not a taxable income, so you would not lose your dividend imputation.

    Perhaps the answer lies in considering what is genuine retirement income and what is not... a ceiling on retirement income before it is deemed taxable is perhaps the only approach.

    Always, BTW, be wary of the first position political parties put forward - usually it is an 'ambent claim' and is designed to move your towards the result they really want.

    In this case, it would appear to me that Shorten & Party are seeking to develop a 'demand' for a ceiling on tax-free income across the board so as to get into Robin Hood mode if and when elected.

    Believe me, the back-room people sit in whiskey fume-filled rooms for days to work out these strategies.... at your expense......
    Anonymous
    22nd Mar 2018
    5:57pm
    Seadove, you overlook the amount of legislation that the LNP have attempted to introduce, which has been blocked in the Senate by the Green/ALP oligarchy - legislation that was targeted at reducing the deficit, CREATED by Rudd/Gillard/Rudd. This is the travesty of our current democratic system - we the electors vote for a party to form a government, based on the policies put to the people at election time, and then these wallies thumb their nose at the will of the people, and oppose for the sake of being obstructionist. They haven't got the country's interest at heart - just their own selfish, greedy short sighted ambitions
    TREBOR
    22nd Mar 2018
    6:25pm
    They have formed a government in the lower house, Al - and are governing only as far as they should. That's how it works.

    There is NO mandate for total control by the lower house,for good reasons.
    OnlyGenuineRainey
    22nd Mar 2018
    6:59pm
    Trebor, you are missing something. If a married couple own a home and have $830,000 in assets, they get no pension. That effectively gifts $36,000 PLUS the value of concessions to the government. It's ''tax'' in another form. I'm not complaining about that. I prefer not to rely on the taxpayer. But it's still true that it's effectively a ''tax''. A pension is nothing more than a rebate of tax. It comes out of the taxpayer purse and it's paid to people who earn below a set limit, so it's a rebate.

    Now, the people who are getting that rebate are saying that those who DON'T get it, because they invested in shares, should NOT GET A REBATE ON THEIR OVERPAID TAX on share income. Geez! Bloody pensioners want it both ways. Give me MY rebate, but DO NOT let them have their much smaller rebate, despite them doing good for the country.

    And by NOT getting the franking credit rebate, the investment income, that is generating only $33000 a year, this SFR couple is being taxed $4500 a year, despite being way below the tax threshold for retirees and below aged pension level. This couple can't split their income for tax purposes. It's income via superannuation. The split is pre-determined and irrelevant. The tax is indirect, paid before the income is paid. The crime is that they don't get it back.

    Sorry folks, but I'm rapidly losing sympathy for selfish pensioners who want THEIR rebate, but want to deny hard working savers a far LESS generous rebate. But then, maybe these selfish dunces think it would be better for all SFRs to go on the pension and blow up the OAP system? That's where it's headed if the ALP has its way.
    Angelique
    22nd Mar 2018
    11:49am
    Evidently as I own a small parcel of shares to provide a very modest income I am now considered "rich" by Bill Shorten. This is news to me. His socialist policies will hurt a lot of people who have provided for themselves and do not want to take any government benefits. Also fed up with the labelling of people on these posts calling you greedy when they have not a clue on your circumstances.
    Circum
    22nd Mar 2018
    12:27pm
    If you own a blue car you must be rich and should be taxed extra.If you want to avoid tax,sell the blue car and buy a red one.Blinkers Bill likes red cars.
    TREBOR
    22nd Mar 2018
    1:27pm
    Not so, Angelique - Shorten specifically said this was designed to catch those with excessive dividend imputation who were also receiving a tax return, when their nominal tax rate should have meant otherwise.

    If your entire income strand put you in a 32% bracket, you would owe 2% more in income tax... if it is 28% you are entitled to 2% return.

    Not hard.
    OnlyGenuineRainey
    22nd Mar 2018
    1:42pm
    Sorry Trebor. I usually agree with you but you've got it wrong in this case. Angelique IS considered rich and will suffer, as will hoards of people who struggled to provide for themselves in retirement and simply cannot afford the huge loss this inflicts on them. Read my example about the couple losing $4500 a year. I could point to hundreds of similar examples.

    God help us all if large numbers switch to property of foreign investment to avoid an unfair loss. The current policy is FAIR. The failure to tax high retirement incomes is the problem - NOT the franking credits. Shorten's policy taxes people with no taxable income - at high rates in many cases. It's WRONG.
    TREBOR
    22nd Mar 2018
    2:20pm
    Read above, Rainey - usually there are more things twixt heaven and earth than are dreamt of in your philosophies, Horatio....
    Angelique
    22nd Mar 2018
    4:15pm
    Circum, I am sure BS has a fleet of red cars and will never have to struggle to pay bills unlike some of the pensioners he sees as a soft target.
    OnlyGenuineRainey
    22nd Mar 2018
    8:05pm
    If Circum is self-funded, Angelique, he worked hard and paid tax to DONATE $36000 a year (if married) to the needy. How much more are you selfish greedy people going to demand he hand over? Will you not be satisfied until he's broke?
    Angelique
    22nd Mar 2018
    8:40pm
    Excuse me OnlyGenuineRainey, I have no idea if Circum is self-funded but I certainly am on a very modest income, so do not call me greedy. You really have no idea about my circumstances and should not be so judgemental.
    OnlyGenuineRainey
    22nd Mar 2018
    8:53pm
    Sorry, Angelique. But your comment about BS seemed to reflect greed or envy. I withdraw any comment that offended. I see now that you are among those Shorten is attacking. Sadly, there are many here who are happy to take pensions but want to rob the people whose hard work and sacrifice contributes to funding welfare. It's apparently not enough for us to work our guts out and pay taxes all our lives, AND give up around $1 million in retirement that is handed to others, but want to deprive us of our fair refund of overpaid tax as well. When is enough going to be enough? When everyone is broke?
    Angelique
    22nd Mar 2018
    10:11pm
    No offence taken OnlyGenuineRainey,we seem to have the same point of view.
    mikecrook
    22nd Mar 2018
    12:03pm
    The scheme was never intended to pay cash back to people who dont pay any tax. Howard changed the scheme as one of his bribes for votes schemes. Companies pay too little tax in Australia anyway, and there are very few low income earners who can afford shares. This whole thing is a beatup, especially when you consider that one on seven Australians live in poverty, they are the ones who need help not cashed up retirees.
    Anonymous
    22nd Mar 2018
    12:08pm
    Which part of - tax refund - don’t you understand

    The franking credits are the amount of tax already paid on your behalf by the company
    Same as withholding tax taking out of your pay or bank interest
    TREBOR
    22nd Mar 2018
    1:28pm
    .. and if your marginal tax rate is 37% - you owe... simple.
    OnlyGenuineRainey
    22nd Mar 2018
    6:41pm
    Um, news flash, Mikecrook. Nearly all Australian workers are invested in shares through the super, and those on tax rates lower than 30% - the LOWER INCOME EARNERS - will ALL lose.

    If you are a PAYE worker and your boss deducts too much tax and remits to the ATO, would you expect to get the overpayment back? I think so! So why should a retiree who is OVERTAXED not get a refund? You are being grossly unfair, and showing complete ignorance of the way the tax system is supposed to work.

    And have you noticed that poverty and homelessness is INCREASING? That's because politicians on both sides are robbing the working class and middle class to feed the rich. And Shorten's policy does precisely that. It takes from the workers to give to the wealthy. It's just been dressed up well to deceive, and clearly he's doing that!

    We will relieve poverty by making the nation more prosperous. That means MORE investment in Australian companies - not less. It means MORE rewards and incentives for people to work and save and be self-sufficient in old age, not bashing them into hardship for being successful. A nation of prosperous people can afford to support the needy. A nation of paupers deprived of their savings cannot.

    22nd Mar 2018
    12:11pm
    Saul Eslake is a left leaning midget among real economists
    Wouldn’t give him the time of day
    VeryCaringBigBear
    25th Mar 2018
    2:11pm
    Because he actually makes sense on this issue and you statement shows your ignorance on this issue.
    4b2
    22nd Mar 2018
    12:39pm
    This article confirms this tax minimisation scheme is only for the wealthy. It does not affect many of the elderly at all only the wealthy ones who believe they can manage their own SMRF. Get rid of it.
    OnlyGenuineRainey
    22nd Mar 2018
    1:26pm
    You can't read, 4b2. It confirms no such thing. It explains that the proposal creates an unfair tax. It wrongly says it won't affect poorer retirees much. Untrue. It will destroy the retirement plans of poorer self-funded retirees and push them onto pensions. It won't hurt the rich who can always restructure around the changes.

    Above I quote an example of a SFR couple who will lose $4500 a year, reducing their income to $33000 a year (well under the pension) while the tax man benefits by some $44500 a year from their saving.
    They are NOT wealthy. They will recoup their loss by draining the savings and going on the pension - more strain on the budget. Less money for pensioners. Really DUMB. Can't imagine how anyone would be blinded enough to support Shorten, but he does lie well.
    VeryCaringBigBear
    25th Mar 2018
    2:14pm
    We are on the full old pension and will lose about$8000 a year if franking credits are abolished. You are certainly not wealthy if you are on the full old age pension. So gets your facts right before you make such stupid comments 4b2.
    Roscoe77
    22nd Mar 2018
    12:58pm
    Increase the tax free threshold for ALL income tax, regardless of whether it is from working income or retirement income and tax the retirement income. If somebody is getting $100,000 in income in retirement, tax it, but make sure the tax free threshold is increased, maybe to $40,000.
    OnlyGenuineRainey
    22nd Mar 2018
    1:23pm
    Agree.
    fred
    22nd Mar 2018
    2:34pm
    Sorry Roscoe , if someone is getting $100,000 in income in retirement and the income is from Australian Dividends they would have already paid 15 % on the contributions they made when accumulating or saving up the investment ie purchase of the shares . Then they have lost 30 % of the $100,000 earnings where the the company pays the tax on their profits before dividends are declared . Why do you think they should be taxed above $40,000 threshold when all retirement income is supposed to be tax free right up to the $100,000 ? of course it wont be tax free if all the imputation credits are cancelled by thieving socialists labor . similarly I do not want Turnbull reducing large overseas Companies present rate if they declare it at 30 % / if that rate falls to 20 % as proposed retirees will lose 33 1/3 of imputation credits so both parties are raiding our savings one to go to socialists and the other to rich overseas companies ,,, It hard to win either way !
    OnlyGenuineRainey
    22nd Mar 2018
    6:30pm
    Can't win Fred. But don't for an instant think Shorten is doing anything different from Turnbull. He's milking the poorer to pay the rich. Not one cent of this claimed saving (which actually doesn't exist) will benefit working class or needy Australians.

    The rich will circumvent the tax - as they always do. The less well off will suffer the loss. More will be pushed onto pensions. We'll all have less to spend. Retirement savings will fall. Australian enterprise will suffer as investment is withdrawn. The economy will suffer, and the poor will - as always - hurt most. Sadly they are too blinkered to see that they are hammering nails into their own coffins.

    Actually, most rich won't have to circumvent it. Did you miss the bit where the wealthy with taxable earnings will still get their refund? It's only the dumb fools who slave their guts out and have nothing but their small investment income that will be deprived.
    VeryCaringBigBear
    25th Mar 2018
    2:17pm
    Only the wealthy will own shares like what was the case a few decades ago.
    OnlyGenuineRainey
    25th Mar 2018
    6:32pm
    So how do the marginally self-funded and part pensioners reap any return on their capital, BigBear?

    Guess they all HAVE to manipulate and go on the pension, and then the claimed $59 billion in savings will be spent twice over paying more out in OAP and concessions. Sounds pretty stupid to me, unless the real motive is to achieve dictatorial powers by making nearly everyone dependent so they are afraid to protest.
    youngy01
    22nd Mar 2018
    1:05pm
    Well Bill,it's going to hurt us ,our income is around 54,000pa. with some 3500 coming from franking credits. Yes we will feel it,probably have to sell some shares we think if Labor win next Federal election....... we certainly would not vote for them !
    Retired Knowall
    22nd Mar 2018
    1:51pm
    Both Major Parties are the same...Do Not Vote For Them or give the any preference. Vote Independents...easy.
    Triss
    22nd Mar 2018
    2:01pm
    Well Pauline Hanson says cash refunds on imputation credits will be axed "over my dead body".
    see all.Maryakate
    22nd Mar 2018
    2:19pm
    Well you seem to be doing reasonably well, and yes if you can't manage on that and you have a nice share portfolio, it is sensible and good business to sell under performing shares. If you can't afford the upkeep in your $m house, downsize. We can always change are way of life if we choose. But asking the Government to subsidize your way of life is not on. There are too many homeless people who need a roof over their head, and while we have greedy people wanting the government to support their chosen lifestyle, we will never solve the homeless situation.
    Jim
    22nd Mar 2018
    4:00pm
    See all I can only see the green eyed monster, the tax we get back on our shares is tax we have paid, if our income is above the tax free threshold then we don't get the tax back, if if is below the tax free threshold we get the tax back, which is exactly the same as every othe tax payer, so why on earth would you want to penalise all pensioners and not other tax payers. The government is not supporting my life style, astute planning and sacrifice during my 50 years of working is giving me my lifestyle.
    Sundays
    22nd Mar 2018
    4:19pm
    Truss is this the same Pauline Hansen, the battlers friend who has just voted with the government to abolish the bereavement payment made by Centrelink, who has agreed to cut the rate of tax for big business and reduce the number of apprenticeships.
    OnlyGenuineRainey
    22nd Mar 2018
    8:02pm
    see all. Maryakate, you are not seeing anything much at all. A self-funded retiree is ALREADY contributing more than $36000 to the homeless and needy. Now you want to rob them of 30% of their income, forcing them to gift their savings to their taxpayer on top of that $36000.

    These people worked their guts out and paid hefty taxes so pensioners could get pensions and the unemployed could get Newstart and the uninsured could have health care. But it seems it's never enough for the selfish green-eyed monsters. Now you want them robbed of their livelihood, and unfairly taxed, while others keep taking pensions and claiming ''entitlement''. Sure, pernsioners are entitled after working and paying tax for decades. SO ARE THE STRUGGLING SFRs you want taxed unfairly and tormented.

    The government is NOT subsidizing the SFR's or part-pensioner's way of life. The SFRs and part pensioners are subsidizing everyone else's. And if you selfish people keep demanding the government take more and more from them, they will STOP and find ways to force the government to pay them instead. Bugger off with your greed and selfishness.
    Triss
    22nd Mar 2018
    10:45pm
    Sundays, I thought the Bereavement allowance was being changed to a lump sum instead.
    Sundays
    23rd Mar 2018
    8:57am
    Yes Triss and they will be $1379.40 worse off than when they received the payment over 14 weeks. It seems very petty at a time when people with little funds are grieving
    KSS
    22nd Mar 2018
    1:39pm
    The problem with this left wing wealth redistribution supposedly designed to level the playing field between the alleged "haves" and "have nots" is this:

    Let's assume for a second that in this left wing utopia that ALL the wealth in Australia is subsumed by the new Government and then doled out in equal measure to every adult over the age of 18. Let's further assume that this situation would be reviewed at the end of the 4 year term of said new Government; what would be the result?

    1) there would be those with nothing left because they used what they had
    2) there would be those with some left because they were careful about what they
    used with an eye on making it last as long as they could
    3) there would be those with more than they started with because they used some of
    their allotment to either make new things which they sold to the other two groups for
    the cost of making it plus a little extra because they had the idea and risked their
    own wealth in the first place; or they did things that the other 2 groups didn't want to
    do themselves and exchanges those services for a little of their own wealth

    Group 1 then calls foul! Says it's not fair they have nothing left and that Group 3 should give them some of their wealth because clearly Group 3 must have been up to no good to now have more wealth than they all started with.

    Group 3, thinks about it and says, OK we will give Group 1 some of our extra wealth but we will keep some for ourselves because we earned it.

    Group 1 new receives a little more wealth but not as much as they once had or think they should have. They know Group 3 won't give then any more so they look to Group 2. Group 2 has more wealth than Group 1 but not as much as Group 3. Group 1 then uses the same arguments against Group 2 as they did against Group 1 after all they had been successful before right?

    Group 2 thinks they are not in a position to hand over some of their wealth especially as the group that wants it had already used up their original 'entitlement' plus extra from Group 3 and were still not satisfied with their lot. Arguments and fights break out among the three groups and each group becomes more isolated from the others with all of them crying foul!

    Elections roll around again and the proponents for the utopian ideal of 'fairness and equality' promise that everyone will be treated with the same fairness and inclusion.

    The reality is some will be the recipients of more 'fairness and inclusion' than others when wealth is redistributed once again in the new order. And so the cycle will start again.

    There will always be the 'haves' and the 'have nots', there will always be those who want more than they get, there will always be those who prosper in any conditions, and there will always be those who manage what they have!
    Anonymous
    22nd Mar 2018
    1:56pm
    Yes KSS
    It’s the Pareto Principle - applies to wealth distribution too
    It’s a fact of life
    Get used to it lefties
    Jim
    22nd Mar 2018
    4:06pm
    Brilliantly put, and so true of the way people think, and of how politicians manipulate the masses
    VicCherikoff
    22nd Mar 2018
    1:47pm
    I think we need to use the blockchain and get rid of Government in the current form altogether. We already know that the Australian Govt is way down the list of honest country governments (https://newatlas.com/2017-transparency-international-corruption-perceptions-index/53520/) so there is a place to start collecting public monies dishonestly taken.

    The blockchain can provide the means for us to vote on issues and representatives standing for those issues would be Independents. This eliminates the idiocy of parasitic politicians who get voted in as a party and claim their policies have a mandate from the people.

    This would also get around the lunacy of franking credits and attempts to steal money from folks who have done the smart thing and invested well all their lives rather than living on all of what they earned or living beyond their means on credit.

    This tax grab is taxing the smart Australians in an effort to support the dumb ones who have not given any thought to their future and come retirement, are looking to the pension as their income. The Entitlement Age is here. Too bad there are too many of us in this country and too few actually producing much and getting wealthy enough to invest for retirement.

    Australians are even not clever or trusting enough to copy the immigrants who use their extended family structure to borrow from lenders to buy another family member's house. They rent the house to these relatives and so the interest and upkeep costs are tax deductible. The rent can even be low so the deal is negatively geared. Once the first house has equity, the value is used to borrow more for other relatives who don't own the house but rent it again. Same tax benefits. If everyone who works also tips in to a central pool then over time, the 3rd party money lender can be replaced with family money and trusts can save even more from the tax man.

    What we do instead is get ripped off paying the banks stupid money which is paid with after-tax income. We never get ahead and struggle for decades unless a real estate bubble lets us capitalize on our asset and we move to a cheaper suburb or city.
    Sundays
    22nd Mar 2018
    4:26pm
    Yes Vic, Vietnamese neighbours we once had did just that. Came here by boat and worked hard. The kids all studied hard and all have high paying jobs. Everyone now has a fully paid off home. We can’t do it because the idea of going without until all our family are set up is just too foreign, or we are too self centred. I admired them
    OnlyGenuineRainey
    22nd Mar 2018
    5:42pm
    I worked my guts out and saved sensibly, and I now see that it was wasted effort. Those with modest retirement savings and smart investments are being robbed and bashed until they resign, shed their wealth or pour it into the family home, and go on the pension. Goodness, some are even boasting about gifting their wealth to grandkids because it is too expensive to keep it.

    There are SFRs who are effectively handing the taxman 120% or more of their annual income, and will be handing over 150% if Shorten's proposal proceeds. And experts reveal that every working Australian whose marginal tax rate is below 30% will lose retirement savings as a result of this policy. If you think it only affects the rich, or it's a ''rort for the wealthy'', you are wearing blinkers and believing bullshit.

    We need to restore incentive and reward in this country if the economy is to recover. Prosperity was built on a system that allowed people to work hard, save, plan, and prosper. Destroying that system and replacing it with a communist system of constantly taking from workers and savers to hand out indiscriminately - often to bludgers, cheats and spendthrifts - is what is wrecking the nation.

    Shorten's proposal - if passed into law - will be another nail in the coffin - another cause of rising debt for the next generation. It may well spell the beginning of the next Great Depression if there is a mass exodus from investing in Australian shares.

    Please stop thinking only of yourself or being blinded by envy and recognize that this policy spells ruin for our country. Hockey did incredible harm with his pension changes. Shorten will finish the job off if allowed to!
    Old Geezer
    26th Mar 2018
    9:48pm
    OGR Shorten has decided that anyone on the pension be it a full or part pension will have their franking credits refunded.
    jzb
    22nd Mar 2018
    2:15pm
    Don't vote for Bill Shorten!
    Charlie
    22nd Mar 2018
    2:49pm
    Quite frankly this doesn't affect me at all..
    OnlyGenuineRainey
    22nd Mar 2018
    6:13pm
    Are you sure? Many THINK it doesn't, but are mistaken. It will hurt EVERY Australian worker who has super savings and whose marginal tax rate is below 30%. That doesn't sound to me like ''attacking wealthy retirees''. It will destroy the retirement of many SFRs and push them onto pensions, which will affect EVERYONE in the nation ultimately.

    And if it really doesn't affect you, then stand up for those it does and help protect the nation and future Australians from devastating damage.
    floss
    22nd Mar 2018
    3:15pm
    For Gods sake people enough of this left right rubbish this is what soldiers do.If both parties went after the over seas multi national companies and gas producers to pay their far share of tax we would not have this problem. What brain dead person wants a tax cut for these companies that pay no tax at all.
    Anonymous
    22nd Mar 2018
    3:23pm
    you're a leftie
    George
    22nd Mar 2018
    8:23pm
    floss, best comment in this whole discussion!

    MINIMUM TAX (without allowing deductions) on Companies and the rich, plus ensuring all Gas exports are valued and taxed correctly, will ensure there are no Budget issues, and they can easily pay Universal Pension to all (qualified by years of Residence, say 25) at Age 65.

    Then, we don't need any of these moronic tax fudges / thought(less) bubbles, or Centrelink costs for administering pensions.
    Triss
    22nd Mar 2018
    10:50pm
    The brain dead politicians want tax cuts for companies that pay no tax, floss, remember when they leave politics they need a grace and favour job with a high salary...the jobs that those same big companies can supply them with.
    Ok
    22nd Mar 2018
    3:26pm
    Guess what! Shorten want to introduce a "Labor hates the Oldies tax", but it will not affect his pension or the pension of any politician. It will only affect pensioners who Invest in Australian companies who pay taxes in Australia. Why does Shorten EXCLUDE POLITICIANS from the new tax? A politician who is looking after his own interest ahead of the rest is called corrupt politicians in most countries around the world.
    He will drive money away from Australian companies and create more unemployment, a higher demand for pensions. Shorten is shortsighted and his view of the economy would fail a junior primary school math test.
    Tib
    22nd Mar 2018
    4:23pm
    The only people who are happy with this change to super are the ones who have none or little. Shorten would rather attack retirees than big business. He's lost my vote. I don't think retirees should be arguing amongst ourselves about which one of us should pay when big business is getting off Scot free. I don't know how this affects the shares our super funds own but I do know this if retirees stuck together and told the major parties to go bother someone else , they would if they wanted to stay in power. Instead we fight amongst ourselves and we are the target of every attack by the major parties both with super rules and pension cuts. While big business gets another tax cut and laughs all the way to the bank and shorten makes a complete idiot of himself.
    Angelique
    22nd Mar 2018
    4:38pm
    Totally agree. This policy is very divisive.
    OnlyGenuineRainey
    22nd Mar 2018
    5:33pm
    Agree. Sadly, there is a great deal of selfishness and envy motivating views and political support. Also, a lot of well-intended concern for future generations from folk who seem to think that the solution to debt and deficit is to rip off those who appear to be slightly more affluent. After all, why should someone who worked their guts out and went without to save be allowed to benefit from that effort. Everyone should be ground down to the same level in retirement!

    I strongly support calls for increased pensions, but I think pensioners should stop making assumptions and allowing jealousy to cloud their judgement and recognize that we all ultimately have the same desire - for a workable, economically sustainable, fair and equitable system that lets all Australians enjoy security, safety, and modest comfort in retirement. That CANNOT be achieved by the methods either the LNP or Labor are pursuing. Both are selling out the nation with short term gains for long term pain. And the proof of that is in continuingly spiralling debt, under BOTH regimes.

    The answer is universal pensions and fair taxation. Fair taxation requires that franking credits continue for all those who have incomes below the aged pension income threshold, whatever the income source. Otherwise, share values will crash, property prices will spiral, foreign investment will increase (to our detriment), the strain on the pension system will increase, and we will ALL be poorer.
    Tib
    22nd Mar 2018
    9:04pm
    Rainey we agree again. As baby boomers we should be the most powerful voting group in Australia. Instead we let ourselves be manipulated and fight amongst ourselves over petty differences.
    floss
    22nd Mar 2018
    4:25pm
    RAPHAEL you have a problem.For your information I am a member of the Fair Go Party.I have no intention of voting for the two major parties .Perhaps a course in good manners may not go astray in your case and take your mate Fred along.
    Anonymous
    22nd Mar 2018
    4:31pm
    stop calling intelligent people "brain dead" just because you have idiotic views on taxing business to death
    talk about a hypocrite
    TREBOR
    22nd Mar 2018
    6:28pm
    How is business being taxed to death when company tax rate is 30%, far less than the AWE earner pays?
    TREBOR
    22nd Mar 2018
    6:32pm
    .. and that's only paid on profits, and they enjoy a host of deductions that the AWE person does not????
    Anonymous
    22nd Mar 2018
    8:09pm
    I suppose you wont be satisfied until the tax rate is 100% trebore.

    the higher the tax the less invested in economic activity by the corporation, its a slow death by taxes
    OnlyGenuineRainey
    22nd Mar 2018
    8:32pm
    Clearly the tax rate for the well off isn't high enough, Raphael, or we'd have a surplus rather than a deficit. Apparently either the government is too inept to find viable savings, or there's no way to make savings other than smashing the lifestyles of ordinary Australians - so therefore the tax on the wealthy is too low. And I'm old enough to recall that this nation was far more prosperous when taxes were very much higher.

    Nobody wants taxes to be 100%. Well, actually, many greedy selfish pensioners DO want SFRs to pay MORE THAN 100%, but that's another story. 30% is a fair rate. As Trebor says, businesses have a lot of deductions the PAYE taxpayer can't claim.

    What most Australians DON'T WANT is tax cuts for companies, because leading economists and even the LNP have confirmed that these cuts WILL NOT produce growth. They are predicted to have virtually no effect on the economy. And given that we can't afford them, they should not happen.

    The government has already destroyed the lifestyles of many self-funded retirees, pushing them to drain their savings until they are pensioners. If we can't afford to treat SFRs with respect, we can't afford tax cuts for companies.
    Anonymous
    22nd Mar 2018
    8:36pm
    wtf ? blame the deficit on not enough taxes?

    my god - talk about dumb. How about reducing wasteful expenditure and reducing the size of government

    raise taxes and the government general revenue will DECREASE not increase in the longer term
    OnlyGenuineRainey
    22nd Mar 2018
    9:00pm
    Raphael, I'd love to see wasteful expenditure reduced so taxes could be cut. But right now nobody in government or opposition seems to have the brains to do that. They only know how to strip struggling self-funded retirees of their savings. Sorry but higher taxes for high income earners is the lesser of the two evils. As I said, the country prospered in the past with much higher taxes. And it's been evidenced that tax cuts for company will not help the economy. But a better deal for struggling self-funded retirees most definitely would. General revenue decreases when more retirees are poor and claiming pensions too.
    mIKER
    22nd Mar 2018
    4:37pm
    You are all wrong, because you are jumping to conclusions based on generalisations in the media that supports one or other party and both camps could be mistaken!! Wait until the Labor Party publishes it's manifesto and then read the fine print on the treatment of franking credits.
    Shorten flew a kite pre-Batman election that may have persuaded a few hipsters that he was getting the rich, the less well off ignored him because they only have their pension and the Liberals in that electorate were ignored by their own party.
    By the time we reach the Federal election I bet there will be a much more nuanced policy that addresses many of the concerns of fellow readers.
    Kathleen
    22nd Mar 2018
    4:55pm
    Spot on!
    Anonymous
    22nd Mar 2018
    5:14pm
    Nope - Shorten is a liar - sleazy worm
    Don't trust him
    George
    22nd Mar 2018
    8:26pm
    BS (Shorten) and MT (vessel) are both liars - I heard the latter claim today that Tax Cuts for big business will go to increased Wages - almost fell of my chair, and ROFL!
    P$cript
    22nd Mar 2018
    5:52pm
    Shorten is looking to reducing the huge debt run up by the LNP and the waste caused by the Howard Government.
    If the Howard government hadn't given away the gains from the mining boom, Australia would suvive the GFC without going into debt.
    OnlyGenuineRainey
    22nd Mar 2018
    6:11pm
    Oh how sad that people are so short-sighted. You can't fix a debt by stuffing the nation and pushing self-funded retirees into hardship so they have to claim a pension. You can't fix a debt by reducing the retirement savings of all lower-income Australian workers. You can't fix a debt by pushing investment out of Australian shares and into foreign investment.

    If Shorten is genuinely trying to fix a debt, then he's totally incompetent and needs to be removed before he does any more harm. Either he's dangerously stupid, or he has another very sinister agenda that he's not disclosing and WANTS to break the budget. (I'm going with the latter!)

    Yes, the LNP is bad news. They are destroying the nation. But Labor's policy will finish the job nicely. It will ruin us all!

    To fix a debt, you introduce a fair and equitable tax and welfare system that respects, incentivises and rewards hard work, responsible saving, and INVESTMENT IN AUSTRALIAN ENTERPRISES. Overtaxing those who support Australian businesses will merely drive investment to foreign shores, and bashing SFRs will put more pressure on the pension system and drive higher OAP costs, pushing the deficit UP.
    P$cript
    2nd Apr 2018
    10:13am
    OGR
    If you are benifiting from the refund of the franking credits you should be very thankful to have gained this bonus. Prior to to the changes made by the Keating government you would be paying tax on the franking credits. Then the mining boom was flooding Howard Government, so instead of using this money for the betterment of the country he changed the franking credits that benifits a few that could afford to buy shares.
    Now that the Labor government has suggested rolling back of this refund to something the country can afford. It will mean the government will have more money for paying pensions and even raised the amount.
    Reading quite a few of your comments I can just see greed, that you deserve this money more than others.
    As a SFR benifiting from this I have always wondered why the tax paid by the company was refunded to me as I am already benifiting from the dividends.
    This is a tax law that needs changing!!!
    TREBOR
    22nd Mar 2018
    6:26pm
    Told yez all the retirement packaging system was broken and needs repair.

    22nd Mar 2018
    6:43pm
    pigs may fly especial the rusted on labor disciples in these colums who can't see or should I say are so full of envy of people who have a bit more than themselves, just read the post of a kathleen mentioning tremor (alias labor mick) and knows very little if any, as having sense? and ticking off those who voted for Trump in America, wel kathy wish you had even a quarter of the brains these people showed by voting for Trump, just read if that is possible, otherwise get your parents money back they paid for your education, how America's fortunes have improved since Trump became president, look at their share market and compare it to Australia's, look at the improvement of their employment to ours, compare their increased trade to ours, compare their emigration policy to ours, etc. etc and it will not take long even for an unwashed laborite to see the improvements this man has made since coming to office, as for the dividends, all I can say smarten up, see cowboy jim's remarks, with to-days interest rates a mattress is a good investment, why do you think so many of our pensioners are living overseas, kathy, tremor(labor mick without the mask) and knows very little if any, just keep believing in your billy boy, already stabbed 2 mates in the back so as to get to the position he is in, don't let Australia be his next victim!!!!!!!
    OnlyGenuineRainey
    22nd Mar 2018
    7:53pm
    Goodness, there are some SELFISH pensioners here. So Mr and Mrs SFR work their guts out their whole life and go without lifestyle to save for retirement. Now, by being SFR, they are saving the government over $36000 a year - $36000 that can be spent on the poor and homeless or on health or education. One might expect they would be commended for that. But instead, the selfish greedy green-eyed monsters who ARE drawing $36000+ per year (or whatever the single rate is if they are not a couple) are now demanding that Mr and Mrs SFR pay 30% of their very LOW income to the taxman, while all other retirees earn their income tax free, and pensioners don't just get income tax free, but actually get a rebate of the tax they MIGHT have paid during their working life.

    It's not enough, apparently, that Mr and Mrs SFR have worked their guts out to DONATE $36,000 a year to the taxman to spend on the needy. No. They now have to suffer hardship - possibly on an income LESS than pensioners receive, paying more for everything, and erode their savings to give MORE to the government, while the greedy, self-serving claim ENTITLEMENT to their handouts.

    Hey, I agree the pension is NOT welfare. I agree we paid for it. But Mr and Mrs SFR paid for it too - probably MUCH MORE than those who are getting it. And they get NOTHING. But not content to see them get NOTHING, you greedy selfish nasty pensioners (well, not all of you - but those supporting Shorten's cruel grab) want Mr and Mrs SFR taxed at 30% of their income, despite the law saying that retirement incomes are tax free. In other words, you want them to gift well in excess of 100% of their income to the tax man, drawing down on savings to do so.

    STOP BEING SO GREEDY AND SELFISH. You OWE Mr and Mrs SFR your support to demand Shorten not implement this UNFAIR measure. And if you don't support them, then expect them to start demanding YOU get less. Expect them to start calling you bludgers and freeloaders, because your are bullying them and demanding their income be STOLEN while you enjoy reaping the benefit of their sacrifice.

    Of course some of you may not be selfish, but just DUMB, and that may well explain why you are poorer than Mr and Mrs SFR. Too dumb to understand economics. Too dumb to save for your old age. In that case, stop demanding smarter people be persecuted and just be grateful that SOME Australians work hard and pay tax so there's money to support YOU in your old age. Because if you think the government set YOUR money aside for your retirement, you are deluded. In case you didn't notice, the country is in debt. There ain't any money in the coffers. So say ''thank you'' to Mr and Mrs SFR for contributing $36000+ a year to reducing the national debt and STOP THE GREEDY DEMANDS THAT THEY BE TAXED MORE THAN THEIR INCOME.

    (Apologies to those pensioners who are not being selfish, including those who are just deluded. But please, wake up to yourselves. You really are being brutally unfair to people whose hard work is benefiting YOU. And if they throw up their hands and divest and go on the OAP, there will be LESS for everyone. But that's what will happen if ignorant Australians keep supporting greedy inept politicians who want to rob the workers and savers of all they earn.)
    Triss
    22nd Mar 2018
    11:03pm
    Unfortunately, OnlyGenuineRainey, the pension money saved doesn't lower the debt or get used for the good of everyone, the Remuneration Tribunal suggests it can be used to raise pollies' salaries, pollies agree with that and the cash disappears like snowflakes in the sun.
    OnlyGenuineRainey
    23rd Mar 2018
    7:17am
    All the more reason, Triss, why pensioners should be SUPPORTING SFRs and demanding they NOT be robbed, instead of cheering the thief because they are green with envy.
    P$cript
    2nd Apr 2018
    10:18am
    You cannot be taxed more than you earn!!!!!!!
    MICK
    22nd Mar 2018
    8:05pm
    What a load of BS Olga. You might want to do some more research.

    "Dividend Davina buys $100,000 worth of shares that earned a profit of $2000.
    You do not understand the difference between a profit and a dividend. A profit is what the company earns and a dividend is what it pays out toe investors. Companies NEVER pay out 100% of the profit anyway and some make a loss. the point being that the company decides how much it is going to pay as a dividend.
    Given that many dividend paying companies are paying more than bank interest I might have thought investors did not need the extra cash back.
    What needs to be done is A THRESHOLD on income established and ob=ver that the refund should not be refundable. Of course you would have to stop the accounting frauds to reduce taxable income and foreign tax shelters, something the current government and I dare say a Shorten government would not touch.

    The system is broken. The rich own the game and plunder the country's tax income pool and NOBODY has the balls to stop it. It is not about imputation credits but far far more serious.
    Anonymous
    22nd Mar 2018
    8:34pm
    Yeah yeah yeah - the sky is falling, blame the rich

    who pays for the pension welfare Mick ? The people on the dole ???
    OnlyGenuineRainey
    22nd Mar 2018
    8:44pm
    My point exactly, Raphael. It's the people the selfish pensioners want bashed and broken who are paying for welfare. The dim witted green-eyed monsters don't know which side their bread is buttered. But if they get their way, they will find out!
    Sundays
    22nd Mar 2018
    9:00pm
    I agree completely Mick. There needs to be a threshold so that pensioners and low income earners are not disadvantaged. If the scheme catches wealthy rorters then it’s a good thing. And Olga, I don’t know your credentials but so many of your articles are poorly researched, full of errors that your lack of attention to detail is affecting credibility. Shares go up in value, if you sell you make a profit. Dividends are seperate. You can even get dividends when the company isn’t making a profit.
    OnlyGenuineRainey
    23rd Mar 2018
    7:11am
    Sundays, shares do NOT necessarily go up in value. One of the major issues right now for SFRs is fear of them falling. And if they are down on the purchase price, the advice is to hold them, but the stinking government has made that impossible for some by demanding they spend their capital to live.

    Shares NEED to go up in value to compensate for inflation, because SFRs - unlike pensioners - DO NOT see increases in their income each year. Their income is at the whim of the economy, and currently generally falling.

    Pensioners whinge about their small six-monthly increases, but they seem to think if someone saved it's fine for them to suffer constant attacks on their nest egg until their is nothing left.
    OnlyGenuineRainey
    23rd Mar 2018
    7:15am
    As to setting limits on claiming franking credits - only if it's clear the taxpayer really is rorting. And the limit should not, in any case, be less than the amount one can earn and still claim a pension. One of my issues with the assets test is that it is far more punishing than the income test. It is grossly unfair that a couple earning $70,000 a year can claim a part pension and a couple earning $24000 a year cannot, just because the latter couple earns it from assets they saved by going without lifestyle earlier in life. Or perhaps it was MEANT to be compensation to pay medical and care costs from an injury - until the greedy government eyed it and decided to steal it.

    When are selfish pensioners going to wake up to the unfairness SFRs are suffering and speak up for them, instead of shouting ''he's got more than me. Take it off him.''?
    Sundays
    23rd Mar 2018
    8:45am
    OGR, I know that shares don’t always go up in value! My point is that you only make a profit if they go up and you sell them. Olga’s article confused profits with dividends. But you only wanted another opportunity to rant about a proposal from a party which is not yet in Government. Personally, I am sick of it. As for your statement that a couple who get a part pension via the income rules but didn’t go without, that is just total BS. Many who pass the income rules receive defined benefit, or military pensions. What right have you to say that Nurses, teachers, police officers, fire fighters and defence personnel and ordinary public servants did not work as hard as you! Unfortunately for them, is there is no residual capital left to go to their estate when they die unlike those with assets.
    OnlyGenuineRainey
    23rd Mar 2018
    5:30pm
    Sundays, I never said anyone who gets a part pension via the income test didn't go without. Please don't twist my words.

    I said the income test is far more generous than the assets test - and it is! For your information, a large number of my very close friends are on military pensions or government pensions, and yes they worked hard and paid taxes and deserve their benefit. As for residual capital, they had far better opportunity to save AS WELL AS qualifying for a pension, and all that I know enjoy the best of both worlds. I unfortunately ONLY had the opportunity to save. I never had super. And now my savings are being attacked and I'm being denied the benefit of going without lifestyle that nearly everyone else I know enjoyed.

    If the stinking politicians have their way, there will be no assets left when I die - and many others will be similarly unfairly deprived. But more disturbing, I don't have security of income for life like those on government pensions. When my money runs out, I'm stuffed.

    I'm deeply grateful to nurses, servicemen, policemen, firemen, etc. for their service and I support their right to a pension - a generous one. But the fact remains that those who saved are being persecuted unfairly, despite potentially having a very low income, and those with secure incomes can earn a very substantial wage before they lose. .
    *Imagine*
    23rd Mar 2018
    6:15pm
    OGR You may be unaware that many public service personnel actually paid into their pension funds (6%) from after tax earnings then later up to 9% of pretax earnings. They clearly went without to do this as they were paid 6% less than their workmates who chose not to pay into the fund. It was optional when I joined. And now as an SA Govt superannuant I have to pay tax on the super pension because the SA scheme was a giant ponzi scheme that absorbed the pension income into general revenue and paid no tax on the capital. My wife who declined the offer has a SMSF. She pays no tax, draws down the same amount as me and unlike me, has the choice to take out lump sums. Our meagre part pension is based on my total income (not taxable income) because my wife's super asset is below the threshold for cut off. Income based means tested OAP pensions can be severe believe me.
    OnlyGenuineRainey
    24th Mar 2018
    9:18am
    Imagine, I am very well aware of the public service pension schemes. Many of our friends have military retirement pensions or police retirement pensions. A close relative was in a local government scheme for life - and had $350,000 two years before retirement and $180,000 on retirement, because ''we made some poor investments''. I know many of them were Ponzi schemes.

    I also know that EVERYONE in these jobs earned WAY more than our tiny and intermittent single income, and few would have copped a $100,000+ bill for a child's medical care in the early 70s and spent over 20 years paying it off. Yet I still saved for retirement, AND sent my kids to university, AND paid off a nice home.

    Now, I am still working years past retirement age because I'm scared of eroding my capital too early and having nothing left to pay the big expenses I know are looming as a result of my partner's disability due to early abuse and my chronic health issues. But the government and opposition seem determined to just take every cent of saving while they keep handing out to people who didn't bother to try. And selfish people here commend that theft.

    My point about guaranteed service or government pensions was simply that those who have them at least have security of income for life. I have nothing but my savings. When they are gone, they are gone. And given that I worked for every cent, paid tax in full when I earned it, and acquired the savings by going without, I think it's unfair in the extreme that I should be deprived of them now.

    I'm really sick of this ''poor me - give me'' crap I keep hearing. I had far less opportunity than probably 90% of Australians, but I saved. Nearly everyone COULD HAVE.
    OnlyGenuineRainey
    24th Mar 2018
    9:38am
    Imagine, I'm sorry if the means test is hurting you and your wife, but if you had two incomes you had well in excess of double what we had to start with. I doubt you had the medical costs for a child.

    My point about the income test is simply that a couple can earn $70,000 a year and still get a small part pension, whereas assets tested couples might have only $25,000 a year (less under Shorten's disgustingly unfair rip-off scheme) and get NOTHING. Sure, they can draw on savings, UNTIL THEY ARE ALL GONE. But that's unfair taxation, because those savings were acquired through going without - delaying spending until later in life.

    What the government, Shorten, and all the nasty ranters here demanding that SFRs be tormented are saying is that you are not permitted to delay spending until later in life. You have to spend it all in younger years or have it confiscated to the taxman and get nothing for your hard work.

    That's UNFAIR. And anyone who supports that mentality is greedy and selfish in the extreme.

    And BTW folks - I am NOT an SFR yet, and might never be, because the stinking policies greedy people are supporting make it dangerous for me to risk eroding capital that I know for a fact will be very much needed later on. But I AM giving the taxman much more than a fair share, and I will have to continue to hand over more than my income for many years to come because of the greed and the LIES.
    *Imagine*
    24th Mar 2018
    2:57pm
    Actually we both worked part time to look after two children, the third died. That's life.
    My gripe is this new approach to facts supported by half truths that too many posters are indulging in. Here is a fact - I get a part UK pension for the time that I worked there, the ATO take 32.5% tax and Medicare levy then Clink take 50c in the dollar on the gross amount. That is, I get only 15% of what the UK send me and the AUS Govt get the rest. Who else pays 85% tax? Have you heard of SAPTO shading where a couple pay more tax than a single person on the same income? If not look it up. Some people on what appears to be $50 000 income are in fact getting nothing like that in reality. The system is broken and trying to draw comparisons between individual circumstances is not going to fix it. Indeed it is playing into the hands of this divide and conquer approach to keeping us all "in our place". I do not mind paying tax or paying my way but I will not stand by and listen to half truths or 'cherry picked ' facts that set one person against another. The only likely official response to your Asset vs Income means testing is to lower the income thresholds. Is that what you want?
    OnlyGenuineRainey
    24th Mar 2018
    6:32pm
    Imagine, I'm not trying to draw comparisons and I certainly don't want to set anyone against anyone else. I am merely heartily sick of the selfish greedy people who constantly ASSUME that someone who saved is ''wealthy'' and it's fair to take all their savings away. The system IS broken. It needs a total overhaul. I am shocked at the way your UK pension is taxed. That's a disgrace. But I'm equally angry that people who forfeit a pension aren't recognized as contributing a huge sum to the taxman, and that people who saved are having to hand over their savings to pensioners who, in many cases, were (and sometimes are) far better off. And it is disgraceful that some people here are supporting taking yet another 30% from people who already effectively pay $40,000 a year tax by not drawing a pension, regardless of the fact that many of those folk have incomes LESS than the pension unless they draw down valuable savings to cover ''tax'' expenses. Nobody should have to draw on already taxed personal savings to pay tax or to compensate for a lost pension. Spenders get handouts. People with expensive housing get handouts. Why should responsible savers be slugged with unfair taxes that strip them of the benefit of their efforts?

    The solution to the Assets vs Income means test is to abolish the Assets test, as it is patently unfair and economically harmful. It leads people to restrict saving or over-invest in the family home, and to cheat and manipulate, to avoid unfair hurt. Tax the income, or deemed income if that is higher.

    Personally, I think we should have a universal pension and tax retirement income over the pension. That is the ONLY fair and economically sustainable solution to the current mess. But more importantly, retirees have to unite and speak with one voice. It's sad that there are too many selfish and ignorant people who can't think past ''he's got more than me - take it off him'', and too many rusted-on political supporters who just swallow massive lies because their favourite politician spat out a lot of words they liked hearing.

    BTW. I am very sorry to hear that you lost a child. That has to be one the worst tragedy any parent ever faces. Hearing that your child has a serious disability is devastating, but I am eternally grateful for my child's survival.
    Kathleen
    22nd Mar 2018
    8:20pm
    People should be more concerned with what is happening in the present. There are some proposals being aired in parliament at the moment that should concern everyone. Check that out!
    Also, this week on QandA something happened that has never happened before. This program is never interrupted but it was this week. The PM took precedence over the Union Secretary’s address to the press. She was talking about the widening gap between the haves and the have nots. The faces on the members of the press were sad. One wonders why the interruption was allowed? There was no emergency.
    The point I am making is that there is plenty that is actually happening now that is being overlooked because people continue to worry about something that is only being flagged.
    Anonymous
    22nd Mar 2018
    8:32pm
    The faces on the members of the press were sad - LOL

    Did the Union hire a bunch of actors to masquerade as journalists ? How pathetic
    OnlyGenuineRainey
    22nd Mar 2018
    8:36pm
    You would be worried too if you were threatened with the loss of 30% of an already tiny income, Kathleen. A little empathy wouldn't go astray. People are justifiably scared. This government has been tormenting and persecuting SFRs and part pensioners. Now the Labor Party appears to be doing the same. Those who went without a lot to save for retirement, planning to be comfortable in old age, are rightly very upset and frightened. You don't know enough about their circumstances to make cruel assumptions that they can afford the loss. But what we do know is that they are already donating a huge amount to the tax man by not drawing full pensions. It's time they were shown some respect instead of being insulted by the very people who are benefiting most from their self-sacrifice.
    OnlyGenuineRainey
    22nd Mar 2018
    8:37pm
    And BTW., it may not be so much the policy that upsets them as the flawed justification being offered. It speaks volumes about the mentality of the Labor Party and its hatred of retirees who saved, and that - without any policy details - is enough to spark fear.
    Sandman
    22nd Mar 2018
    11:50pm
    There is a lot of talk about Shorten taking the gold fillings out of pensioners teeth but how many were affected by pension assets test? There is no denying that our government is short of cash and yet they want to give tax cuts to corporations when There were 732 companies who paid no tax in Australia in the 2015-16 financial year. Collectively, their income was more than $500 billion.
    http://www.abc.net.au/news/2017-12-07/corporate-tax-data-released-by-ato/9236878
    The tax cut will cost an eye-watering $65.4 billion over 10 years from July 1, 2017
    https://www.smh.com.au/politics/federal/malcolm-turnbulls-company-tax-cut-rises-from-50-billion-to-654-billion-20170511-gw2ksm.html
    If they really want to raise revenue they should look at our resources that they are giving away. In 2021 we are expected to surpass Qatar in Natural Gas exports and in that year it is expected that Qatar will get $26.6 Billion in royalties (note that word) and we will get $0.8 of a Billion in petroleum resource rent tax. https://www.smh.com.au/politics/federal/turnbull-government-called-on-to-explain-where-australias-offshore-gas-wealth-is-going-20161009-gryaoi.html
    The petroleum resource rent tax has so many loop holes for to get out of paying it. If anyone wants to dig or pump our resources they should pay a ROYALTY like they do in other countries. It is ours and if they want it they should pay for it then we would have the money for our pensions our schools our hospitals.
    OnlyGenuineRainey
    23rd Mar 2018
    7:37am
    First all those battlers who would be crushed by this CRUEL AND UNFAIR tax were ''greedy rorters''. Now they are evil for telling people how to vote and should be ''waiting for the detail''.

    Excuse me. BS didn't say ''we are considering this change to tax law and want feedback as to what impact it would have so we can shape the policy fairly''. NO. He said 'this is how it will be and it WILL pass into law when we are elected.''

    Sorry, Kathleen, if some people are angry enough to say 'vote against Short-on so this doesn't happen. Why should they wait for details they were clearly advised were NOT under consideration. The policy was stated to be final. Yes, BS (and he's full of it, it seems!) began to back down when it was evidenced how very wrong the policy was and that it would hurt battlers. But he should never have announced it as firm policy if he didn't already know what harm it would do.

    He's proved either gross incompetence and that he's not qualified to govern, or that he has a sinister ulterior motive that isn't being disclosed. I'm going with the latter, and I'm congratulating Short-on for NOT being short on knowledge of how to manipulate and deceive the population. He read the average selfish, self-serving fool correctly and he's playing them.

    I'll keep telling people to vote against Labor, though I'm sad that they've proved to be so inept because the LNP is NOT deserving of anyone's vote. And that leaves all of us intelligent voters in no-man's land. I am not seeing much talent among any independents or minors, and they won't get in anyway. Too many of them fighting among themselves.
    OnlyGenuineRainey
    23rd Mar 2018
    7:44am
    And BTW, Kathleen, the ignorant who vote for him are voting for their own demise and to hurt the poorest Australians most by economic mismanagement. Sadly, they are just too easily misled by liars to see what is real.

    This policy is aimed at destroying retirement. It is COMMUNIST mentality - take from anyone who worked and saved and give a few more crumbs to those who didn't so they will keep supporting the huge rip-off that is feeding the super-rich at everyone's expense. Make us all poor and dependent in old age and we'll be too scared to revolt.

    Once again - THE RICH WON'T SUFFER. This is an attack on the struggling working and middle class who work and save to make the economy strong.

    Unfortunately, I don't know what the alternative is. I can't vote for the vile stinking LNP - who took the first step in demolishing the capacity of SFRs to continue self-funding and donating millions to a government that misuses it.
    VeryCaringBigBear
    23rd Mar 2018
    8:25am
    From reading the comments very few here have any idea what franking credits are.

    The rich are having a good laugh on this one as it will be business as usual for them.

    It is the struggling retiree or pensioner who has done the right thing and invested their money in shares for a much better return than deposits that is being fleeced here.
    Old Geezer
    23rd Mar 2018
    11:22am
    I agree the lack of understanding here is outstanding.
    Oars
    23rd Mar 2018
    1:56pm
    THe first wild statement that "the average Australian is iunfuriated that... wealthy ... are drawing a tax free income "" is misleading and biased towards a small percentage of "so-called wealthy". Also , the "infuriating" comment is from most peole that I know and have read on this blog are infuruiated that labor has tried yet another whitewsh of the real issue, which is that labor has nowhere to turn but use this blatant "get the wealthy" broadcast to appease their dumbed-up followers. Thank goodness the rest of us wide awake to such biased, and innaccurate reporting.

    23rd Mar 2018
    3:00pm
    I’ve changed my mind on this
    I hope Shorten persists with this policy and takes it as a major labor mandate into the next election
    Would love to see the labor party obliterated and an end to the turds political career
    OnlyGenuineRainey
    23rd Mar 2018
    5:23pm
    I'd agree Raphael, except the LNP is worse and I fear the majority are too blinkered and selfish to vote against Labor's policy anyway. If it doesn't hurt them, they support it. They just can't stand the thought that someone else might have a dollar more than they do.
    DogLover
    23rd Mar 2018
    5:17pm
    Does everyone forget when Turnbull reduced the pension asset test and so many lost all part pension payments and concessions or received a vastly reduced part pension. Paul Keating started the original franking credits refunds which were fair but then Howard, predictably, changed it so the wealthy Liberal voters would receive an unfairly large refund. And I hate to think how pensioners will suffer financially if corporate taxes are reduced!
    OnlyGenuineRainey
    23rd Mar 2018
    5:22pm
    Wrong, DogLover. Howard changed it to be FAIR by allowing those who were OVERTAXED to get refunds. If this system is being rorted, address the rorts. Don't persecute the overtaxed shareholders who rely on a refund they SHOULD RECEIVE to get by - many without claiming any pension at all.

    The current system is CORRECT. If you don't earn enough to be liable to tax, you SHOULD get it back. And anyone claiming BS's BS will only affect the wealthy is deluded and believing LIES. It will affect a lot of hard-working Australians with very modest means - and yes, we all recall Turnbull and Hockey's cruelty and evil, but it's the same people who will be hurt again by Shorten. Two wrongs don't make a right.
    VeryCaringBigBear
    24th Mar 2018
    8:55am
    Super funds are taxed at 15% tax on their earnings in the accumulation phase and zero tax for funds in the pension phase. So as more people retire more funds move I to pension phase unless they can be matched by more funds in the accumulation phase.

    That said if half the funds were in accumulation and half in the pension phase the super fund will pay 15% tax on half the earnings. To take full advantage of franking credits a super fund can only gave 25% of it's funds in equities with 100% franking.

    That means the super fund has to invested in lower performing investments or more risky investments to produce same return it does today.

    IF you gave super of any kind then you will be exposed to more risky investments or have your returns reduced by this proposal. Worse still Australian equity market will suffer and then will mean few jobs and investment by Australian companies. Not to mention reduced spenind power of people with less money to spend. Any persevere gain by this policy will be more than wiped out by more welfare and less tax revenue collected.
    OnlyGenuineRainey
    24th Mar 2018
    9:40am
    Yes, BigBear, the LIARS aren't admitting that this STUPID policy change will hit every Australian worker.

    Misty is ranting about workers supporting Shorten's grab, thinking it will reduce their tax. It will reduce their retirement nest-egg actually, AND economists say it will INCREASE the deficit within 2 years of implementation because of undesirable flow-on effects. But dunces just swallow lies and can't see the woods for the trees.
    Grateful
    24th Mar 2018
    11:47am
    I'm just glad to see someone like Saul Eslake finally have the guts to tell it how it really is and looking at the CAUSES with "Mr Eslake was scathing of the raft of tax concessions, bonuses and other benefits that had been created during the years in which John Howard and Peter Costello were at the helm. Among those concessions was a requirement that the Australian Taxation Office convert the franking credits into a cash refund for investors on a marginal tax rate of zero.
    “Mr Costello also introduced an exemption that allowed Australians aged over 60 to withdraw huge amounts from their superannuation, tax-free."

    This pair has caused inestimable damage to millions of Australians, firstly by sending Australian troops to fight George Bush's war in Iraq thus creating us as a "target" for terrorism, something unknown to "older" Australians, and involving us in spending billions of dollars with huge inconvenience on security.
    Then with their incredible tax concessions which have very heavily favoured the very rich at the expense of the day to day battler, especially effectively denying generations of young people of the opportunity of owning their own home, something older Australians, rightly, took for granted with those unsustainable negative gearing concession.
    Now they have the absolute impossible task of competing with heavily government subsidized investors to try to purchase a home, and if they do, have to pay exorbitant prices, with massive mortgages, which will tie them down to a life of misery and family stress.
    Thank you Saul, at last the CAUSE of very much of Australia's present crises are pointed fair and squarely at the perpetrators.
    Shame on them and just to be re-elected!!!!
    ex PS
    24th Mar 2018
    6:12pm
    What it comes down to with most Retirees, is people who have not paid tax do not get to make a tax deduction against their shares. As someone who does receive franked dividends, even I can't find a decent argument against this.
    I will just move my investment funds into something else, if it looks like I will be effected.
    To tell the truth I would not be in the share market at all if the current government had a realistic grasp of deeming rates.
    It is almost as if the two so called major party's are colluding to separate the Retirees from their money.
    I am not far off just buying a million dollar house and going on a pension, there seems to be less and less incentive to look after ourselves.
    OnlyGenuineRainey
    24th Mar 2018
    6:17pm
    Grateful, perhaps you chose to ignore the statement that the refund of franking credits is NOT a rort but is fair and equitable and it would be UNFAIR and discriminatory not to allow the refund.

    You appear to swallow the nonsense that this will only affect the rich. That's grossly untruthful. Every Australian worker will be hurt, and the poorest will hurt most. Hundreds of thousands of retirees will be hurt, and the worst hurt will be to those not much over assets thresholds who are already saving the taxpayer a small fortune, and who now will pay 30% more tax than everyone else just because they chose to invest in shares rather than something else.

    I don't agree with a lot of the LNP policies, and I agree the LNP has done massive harm to Australia. But Shorten's lazy tax grab will exacerbate that harm and is grossly unfair. It has been estimated that the flow-on effects will cancel the benefit within 2 years and within 5 years it will cost more rather than saving.

    Financial advisers are telling clients that unless they have millions, they are better off with about $500K in savings because under our stupid means test, those with more than $500K (for a couple) reap no benefit for their extra savings. Shorten wants to overtax those who try to be self-funded or largely independent by imposing an unfair tax of 30% - ONLY if they own shares and ONLY if they have no other income to offset against. Doesn't sound to me like ''an attack on the wealthy'' - and IT ISN'T. And it certainly won't alleviate any housing problems - not that the lifetime cost of a house is any higher now than it was for my generation, who had to pay 18% interest.

    There are tens of thousand who, like me, will throw up their hands and say ''it's just too hard to be self-funded in retirement, because they take take take take take, and you are constantly being bullied and abused by greedy selfish folk who happily claim a pension, but then want those who don't taxed over and over and over again until there is nothing left. When many throw up their hands and reduce their savings, Shorten will find the cost of the OAP skyrocketing and all his '''savings'' disappearing.

    I agree we need to tax the rich more fairly. This policy DOES NOT DO THAT. Please educate yourself and stop supporting blatant LIES.
    OnlyGenuineRainey
    25th Mar 2018
    8:52am
    ex PS, according to financial advisers I talk to, you are one of tens of thousands. If the fools in power keep hitting on retirees, more and more will just throw up their hands, buy bigger houses, and claim a pension. Younger folk are already gifting, cruising, etc. to limit their savings because they see that there is a ''sweet spot'' where you get a very substantial part pension and can have a few hundred thousand in assets, and unless you can have millions or a large secure income, there's no point in saving more.

    What people like Grateful and Misty fail to understand is that these policies are just pushing people who are currently NOT a drain on the taxpayer to quit trying to be self-sufficient and put their hands out Apparently the Labor Party leaders also fail to comprehend that. But what's even more scary is that all politicians seem to count ''savings'' by looking at yesterday's numbers, and ignore the fact that psychological responses by the market will make the numbers VERY different after a policy change. There will no longer be $59 billion to claim - because the cost of the OAP will rise as people quit struggling to be self-sufficient; investment will be moved from shares to other areas; people will rearrange their affairs to move shareholdings out of pension-phase super and into entities that pay tax.

    And would someone please tell me how it impacts ''wealthy'' retirees when those with over $1.6 million in super MUST have the balance in accumulation phase and therefore CAN CLAIM THE TAX BENEFIT. Only those with LESS than $1.6 million lose it. And only then if they have no other income besides their superannuation pension. In other words, the LESS WELL OFF RETIREES LOSE. Once again, the RICH DO NOT.
    Old Geezer
    26th Mar 2018
    5:23pm
    OGR if something doesn't affect people themselves then everything is OK. Most people here Have no idea but just believe everything they read and comment accordingly. They will wake up one day and realise their favourite breakfast cereal is no more because the company that supplied it couldn't get anyone to invest it in and has gone broke. Caravaners have recently been commenting that UHT cream is no longer available so it's happening already.

    I doubt that this proposal of not refunding refunds has legs and it will affect me with my current investments. However I am not too concerned as there are other ways to invest even in equities to make the same or maybe a better return.
    Old Geezer
    26th Mar 2018
    11:43am
    Same Henderson calls Shorten a goose for good reason.

    https://www.youtube.com/watch?v=QQ6kwn7l7c4&feature=youtu.be&inf_contact_key=59debc30dc77e65e1acd025a43304979c34aa132c7ccdbe8be144162b30413bf
    OnlyGenuineRainey
    26th Mar 2018
    8:55pm
    I heard Shorten backed down on this idiotic proposal. I hope that's true, but it's sad that he made such a goose of himself. I think he may have handed MT victory on a platter with this stupid idea. What a shame! Not that I was all that keen on having the ALP in power, but I sure didn't want the LNP returned either. Whichever won, I hoped it would be by a very tiny margin so they would struggle to do any significant harm.
    Old Geezer
    26th Mar 2018
    9:51pm
    I have heard he has only backed down as long as you are on a part or full pension. Any other low income earners or super funds will not have their franking credits refunded.
    ex PS
    27th Mar 2018
    9:47am
    A party leader who is prepared to listen and revise his plan, unheard of, I'm used to the ones who will not admit an error under any circumstances and will not back down no matter what damage is done to the voter.
    Old Geezer
    27th Mar 2018
    10:52am
    Unfortunately some advisors are now working on a plan around the non refund of franking credits. But unfortunately what I have seen of the plan it has the potential to change our financial system so much it may in fact bring it to it's knees. We will finally have the GFC the rest of the world had.
    Old Geezer
    27th Mar 2018
    11:02am
    Looks like the fully self funded retirees are going to be hit hard on this one. How many will buy bigger home and divest their assets before they reach pension age?

    http://www.abc.net.au/news/2018-03-27/labor-to-change-to-cash-refunds-policy-to-protect-pensioners/9589578
    ex PS
    28th Mar 2018
    9:47am
    I am one of those people, not because of one rebate change that will not make much difference to my income, but because all politicians of every flavor seem determined to get their hands on the trillions of dollars in Super Funds.
    Far less complicated to distribute our Assets and just have enough cash on hand to ensure a full pension.
    We will go from fully self funded to Old Age Pensioners, no problem, we are just accessing a system that we have contributed to for decades and no worries about managing investments.
    Successive inept, greedy governments will have succeeded in destroying the self funded retirement system, but I think that is exactly what they want, poor people are easier to control, just fling them some crumbs in the form of $3.00 pension increases and they will sell their votes.
    P$cript
    2nd Apr 2018
    9:40am
    ex PS The government cannot touch the superannuation you have, the only thing that changes it the way you receive the funds.
    The pension is the to make sure everyone has a living income.
    Not a right of everyone just because they can hide their wealth. This just robs money from future generations in the form of education and health the government has to fund.


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