There is a growing weight of evidence showing how grossly unfair Labor’s changes to franking credits are and how badly they will impact on our seniors. In fact, there have been more than 1,000 submissions to the Parliamentary Enquiry so far and public hearings continue this week.
In case you missed it on the weekend, respected economist Robert Gottliebsen has outlined eight reasons why her believes the tax is unfair.
We added two more, to drive home the message.
Below is a brief summary:
- It targets battlers.
- It discriminates in favour of the rich.
- It taxes people on the basis of who manages their money, not their actual assets or income.
- Labor claim pensioners will be exempt, but have failed to admit that pensioners who join self-managed funds after the policy announcement date will in fact be hit.
- Labor won’t call a tax a tax. Their plan increases the government’s tax revenue - it is clearly a tax.
- It retrospectively taxes small businesses that have structured their finances so that their company has stored franking credits.
- It retrospectively taxes retirees who planned for their retirement.
- It changes a system that has been recommended by independent Reviews and has had bipartisan support for decades.
- It favours industry Super funds over Self-Managed Super Funds (SMSF) creating a discriminator system for the first time in Australian history
- It will force hundreds of thousands of retirees onto the pension.
It’s a pretty straightforward assessment.
However, we think that Mr Gottliebsen sums it up best when he writes:
“While I don’t consider myself rich, I have a level of wealth that means that, with normal diversified investments, I will not be affected by this tax. And all the people I know in a similar or higher wealth bracket are just laughing at the ALP’s proposed tax. It does not affect them.
But I know a lot of people who are not as well off and they will be crippled. It’s not fair.”