Powered by MOMENTUM MEDIA
Powered by MOMENTUM MEDIA
Subscribe to our newsletter SIGN UP
Franking credit recipients ‘already on public purse’, says Shorten

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Franking credit recipients ‘already on public purse’, says Shorten

Opposition Leader Bill Shorten has pushed back on suggestions that his franking credits changes will cause self-funded retirees to rely “on the public purse”, noting that they already were by receiving cash refunds under the current regime.

Tax&Compliance Jotham Lian 02 May 2019
— 1 minute read

In an ABC 7.30 interview, Mr Shorten was asked if the proposed changes to franking credits would mean that self-funded retirees like Chris Phillips, who currently receives $9,000 in franking credit refunds out of a $36,000-a-year income, would be forced to rely “on the public purse”.

Advertisement
Advertisement

“He already is, and this is the real heart of the issue,” Mr Shorten said.

“When you get an income tax credit when you haven’t paid income tax, its a gift from the government. Youre already on the public purse.

“But the criteria by which you get this money is that you happen to own shares, and [Prime Minister Scott] Morrison has been most dishonest on this where he says we are coming for people’s savings — no, we’re not — and he’s been dishonest by saying this is a tax.”

Shadow treasurer Chris Bowen was made to clarify his comments around figures used to support the policy earlier this week.

But Mr Shorten has not softened his stance around the proposed changes, insisting that it was “a gift” that was costing the government $6 billion a year.

The Labor leader has so far promised close to $7 billion in spending on childcare subsidies and pensioner dental care, as well as a $2.3 billion Medicare cancer plan.

“What the Liberals don’t say to you is that, when you get this dividend income, you own shares, you get this interest or dividend from the shares, it is tax-free,” Mr Shorten said.

“Not only do you get this income tax-free, you get a 30 per cent top-up from the government; it is a government payment.

“It is not illegal and it is not immoral, but this generous gift going to some people purely on the basis that they get dividends from shares and don’t pay tax is costing $6 billion a year and nearly $8 billion a year in the very near future — it is eating the budget and it is just a gift.”

Franking credit recipients ‘already on public purse’, says Shorten
image intro
accountantsdaily logo
Jotham Lian

Jotham Lian

Jotham Lian is the news editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.

With a focus on breaking news and exclusive analysis, Jotham keeps Accountants Daily readers up to date with company moves, tax updates and essential business and client strategy. 

Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.

You can email Jotham at: This email address is being protected from spambots. You need JavaScript enabled to view it. 

Tax&Compliance
FROM THE WEB