Franking Credits....Will you make you mark in the correct square

[tar trekka]

Hi there,

It's not so much the "Franking Credits" that is the "Problem", it's the "Country's Credit Card Debt" that's the "Problem".

"Australia's Credit Card Debt is $350 BILLION PLUS", with "NO CHANCE OF REPAYMENT IN SIGHT".

Labour & The Greens want to "Spend More On Renewals & Sell Less Coal".

"More Spent, Less Sold" & the "Credit Card Debt" gets BEYOND JUST BIGGER.

With that scenario, if I were an International Banker, I may "Think Twice" before allowing the "Debt To Increase".

AND IF I DID,I MAY INCREASE THE INTEREST RATE BECAUSE OF THE ADDED RISK.

Just think of "Brexit" & be "Careful What You Vote For".

Tar Trekka.

[/Any day above the ground is a great day.b]

[Motherhen]

While my understanding of franking credits may not be correct, I see them as a way of avoiding double taxation, by the company then by the shareholder. Far enough too. But if the shareholder does not have a taxable income, the franked income is not being double taxed. However if they are given back to the non tax payer, the net result is that no tax is being paid on that portion. Is that right?

Most of the time people complain about big companies not paying enough tax and saying it isn't fair. So what do you want - tax the companies fully, or if not a tax payer get a little bonus at tax time from the shares you may well have purchased for that purpose?

I welcome anyone with the expertise to explain the situation clearer or more correctly.

[Jay&dee]

I for one do not have my annual franking credits sitting in a bank account. I have spent the money on keeping our head above the water line.
Let us not forget that the Billions of Dollars that is in question here, is re generated back through the community. This in turn supports hundreds and hundreds of small and large business, who then pay tax, Then there is the jobs created by this cash which in turns means tax is paid.
It appears to me that the refund is a self generating system that provides revenue for our government to run the country.
I wonder if an exercise by B.S. or Mr Bull doodoo has been done on the actual loss of tax revenue through the idea of doing away with Franking Credits.
It might surprise us all.
Also re the individual person on a Centrelink (C.L.) pension, they will therefore go to C.L. for a pension increase, as their income will be reduced, and therefore qualify for more tax payers dollars.
But the bottom line is, I need my Franking Credit so as we can hook up our van. Van in front yard means no dollars being spent in regional Australia who are screaming out for our support.
I guess that we could go round and round in circles re this subject.
By the way we do not qualify as "' Top end of Towners"' Just proud dinki di Aussies.
Oh!!! and yes, I will make my mark in the L.N.P box on voting day

Jay&Dee

[Old Techo]

TA it is a well known fact that I'm not very good at working with children.

We have been down this path in other threads where you haven't answered a simple direct question.

Here you wisely advised that I should be aware of X and Y. I said I had always known and done X and Y and so I then asked you.... what was I missing?

I gave you the opportunity to educate me. Providing non answers is also what pollies do and of no educational value to any of us.

You may now play on your own.

[Old Techo]

Today's Age Newspaper...



It's right to remove dividend tax lurk

One of the big issues of the looming federal election is also one of its most obscure: Labor’s plan to cease dividend imputation payments to dividend recipients who are outside the tax system.

It has unleashed a battle in which facts and context have suffered heavy casualties.

The electoral contest over franking credits (which reduce an investor’s taxable income, including from dividends, by the amount of full company tax paid) has been reduced to claims and counterclaims of injustice.

The Coalition contends changing the rules is stealing from pensioners and retirees who have legally structured their portfolios – particularly in self-managed superannuation funds – to provide a retirement income. It claims the move is tantamount to a ‘‘retirement’’ tax.

Dividend imputation was introduced by Labor treasurer Paul Keating in 1987 to prevent Australian companies from being taxed twice – through a company tax, then at the shareholder level. The tax paid at the company level ‘‘would be imputed, or allocated to shareholders by means of imputation credits’’.

The Howard government in 2001 extended these franking credits to people who paid no tax.

Labor plans to wind back the policy to the Keating setting, thereby stopping the government’s cash refunds to shareholders who are outside the tax system. It says ending these refunds will save $10.4 billion over four years.

To prevent the policy from hitting low-income earners, Labor has introduced a ‘‘pensioner guarantee’’, exempting pensioners, including those who receive a part pension. The Parliamentary Budget Office estimates this will take in some 320,000 people. They will continue to receive cash payments, as will such bodies as charities and universities.

The money saved will be redirected to health, education, infrastructure and buttressing the budget at a time of growing economic uncertainty.

Policy principles tend to provide a better route to a just outcome than do political pitches. Australian governments, like many others, believe it is unfair and unwise to penalise and impede the engine of economic growth and employment, the private sector, by taxing profits twice – at the company level and as dividends.

Australia, unlike practically every other market-based democracy, unwisely created this anomaly by distorting that principle. With an ageing population, this distortion would prove unsustainable.

The Labor policy is about levelling the future investment playing field. Pensioners are quarantined.

Should Labor be elected, it must consult widely on an implementation date to give all those people affected time to arrange their finances.

The policy is economically and socially rational – and just.

[diesel]

But the bottom line is, I need my Franking Credit so as we can hook up our van. Van in front yard means no dollars being spent in regional Australia who are screaming out for our support.


Jay&Dee

I think the catch cry that regional Australia relies on the travelling public to make ends meet is just not true, Jay&Dee. I've lived in regional Australia most of my life and apart from tourist attractions where some travellers (not all) spend the occasional dollar, it's locals who keep small business going, not travellers.

The buying habits of travellers do not change all that much when they are on the road. They still shop at the big supermarkets as they pass through larger towns and then maybe buy a cake & coffee when passing through a smaller place - a business has to sell one helluva lot of cake & coffee in a day just to cover overheads, let alone make a decent living. One or two businesses in a regional town might benefit from travellers spending a few bucks, but they are rare.

The thing that is killing retail regional Australia is online shopping and tourist dollars do not compensate. If locals do not get behind local business and support them, then along with all the other negative factors that effect regional areas, the future is grim.

Jeff

[Jay&dee]

But the bottom line is, I need my Franking Credit so as we can hook up our van. Van in front yard means no dollars being spent in regional Australia who are screaming out for our support.


Jay&Dee

I think the catch cry that regional Australia relies on the travelling public to make ends meet is just not true, Jay&Dee. I've lived in regional Australia most of my life and apart from tourist attractions where some travellers (not all) spend the occasional dollar, it's locals who keep small business going, not travellers.
Jeff, you may be right, but someone or some towns are benefiting from our $$$$. Even the large Supermarkets employ locals so the money goes around/

The buying habits of travellers do not change all that much when they are on the road. They still shop at the big supermarkets as they pass through larger towns and then maybe buy a cake & coffee when passing through a smaller place - a business has to sell one helluva lot of cake & coffee in a day just to cover overheads, let alone make a decent living. One or two businesses in a regional town might benefit from travellers spending a few bucks, but they are rare.

The thing that is killing retail regional Australia is online shopping and tourist dollars do not compensate. If locals do not get behind local business and support them, then along with all the other negative factors that effect regional areas, the future is grim.

Jeff again spot on, however we very very rarely buy on line. Oh!!! the Dee she purchases a lot of e books for her kindle. We like to support the locals including IGA where possible

Jeff

I guess that groceries and petrol are the big dollar expenses for most of us. We only visit C.Parks if and when we have to. . Love the love the serenity of the bush camping.
jay&Dee

[Engel]

Interestingly the last political party that tried to go from opposition with a new tax lost the unloseable election.

Just wait until we see Morisson's invitation of a refugee boat materialise then Labor will be on the back foot.

Currently Labor they think they have big enough buffer but that can change quickly.

[tar trekka]

Hi there,

"The Labor policy is about levelling the future investment playing field. Pensioners are quarantined".

How can they "Level The Future Investment Playing Field" if "Pensioners Are Quarantined"?

The "Most Level Playing Field" would be created if "No Retirees Received Franking Credits" and "All Retirees Received a Government Pension".

Tar Trekka.

Any day above the ground is a great day.

[loub]

In reference to the Age newspaper article,they don't high lite the 600 to 700 hundred thousand of self funded retirees who are not on the pension and just have enough to get by.They keep on saying here is a line and this means your wealthy
Well we are not wealthy and get a few thousand in franking dividends,that pays the car and caravan rego and house insurances.
Labor is just driving a class war, Them against us,while all along these bogus union officials and Chardonnay Labor pontificate that these can pay ,we don't care they don't have their hands out so would not vote for us