This.I thought the problem was not franking credits , which were brought in by Labor but abuse of franking credits in the low tax environment of Superannuation.
That is spot on Knobby and to a degree has been backdated, by making the tax on super balances above $3m taxable at 30%, also the amount some can have in the pension phase has been capped, this is called the lifetime transfer balance cap.I thought the problem was not franking credits , which were brought in by Labor but abuse of franking credits in the low tax environment of Superannuation. Where a Mr Wilson and certain others had arranged their assets so they claimed $100s of millions of franking credits every year to the detriment of Australia.
A better solution than setting a maximum amount allowed for franking credits would be to limit the maximum amount allowed in Superannuation. This has been done but possibly cannot be backdated.?
I thought the problem was not franking credits , which were brought in by Labor but abuse of franking credits in the low tax environment of Superannuation. Where a Mr Wilson and certain others had arranged their assets so they claimed $100s of millions of franking credits every year to the detriment of Australia.
A better solution than setting a maximum amount allowed for franking credits would be to limit the maximum amount allowed in Superannuation. This has been done but possibly cannot be backdated.?
I'm no expert here, but that could include both low income earners who did not reach the tax threshold, but also people with high superannuation pensions whose income from those pensions are exempt from tax.In 2001, the Howard government controversially extended the system to shareholders who were not actually paying any tax.
There are several things that you missing out.There are a few problems but this is the main issue IMHO
Below was the original concept which Smurf and SP are talking about, all good.
" In 1987, then-treasurer Paul Keating introduced franking credits - also known as dividend imputation credits - to address the issue.
The change meant that at tax time, shareholders were compensated."
"What it effectively means is that the income coming from the company only gets taxed once,"
But then
In 2001, the Howard government controversially extended the system to shareholders who were not actually paying any tax.
"The Howard changes meant that even if you were paying no tax ... You'd get that tax credit, basically a cheque from the government."
In other words a handout nothing to do with sorting out double taxation which is the whole point.
Cost is likely over $10 bil now.
I'm no expert here, but that could include both low income earners who did not reach the tax threshold, but also people with high superannuation pensions whose income from those pensions are exempt from tax.
I think Shorten tried to go after the second group, but some in the first group were also caught in the net.
Would that be correct?
So now you have explained why Keating originally gave the tax back to the rich and wouldn't give it back to those who were below the 30% tax rate but didn't deserve a refund even though their dividends were taxed higher rate than they should have had to pay, niceYes correct, the changes in 2001 included both which had nothing to do with the original reasoning for addressing double taxation
@sptrawler from reading your post, one can only assume that the rich get richer (lucky them), and the rest do as they always do, pay and suffer, in some cases badly.So now you have explained why Keating originally gave the tax back to the rich and wouldn't give it back to those who were below the 30% tax rate but didn't deserve a refund even though their dividends were taxed higher rate than they should have had to pay, nice
So now how come Shorten was going to give the franking credits to the union Industry funds, when the highest tax rate for their members was 15% for those in accumulation phase, yet all SMSF were going to lose them no matter if they were in accumulation or pension phase?
Also as the mega rich still use the progressive tax system, the first $18k of their income is tax free, then the next step is taxed at lower than the 30% franking credit.
So they work out their tax then add dividends and apply the franking, are they paying anything on their first $18k, or the next stage?
I don't think that happens, from memory total income is entered including dividend, then franking credits are entered and tax payable is reduced by the franking component, at the tax bracket, therefore they would be getting the tax back for the two lowest brackets.
So now you have explained why Keating originally gave the tax back to the rich and wouldn't give it back to those who were below the 30% tax rate but didn't deserve a refund even though their dividends were taxed higher rate than they should have had to pay, nice
That is pure BS, sorry but if they had wanted to do it in a honest way, they could have thought of ways of doing it. Taking 30% tax off low income earners and allowing high income earners to use the same as a deduction, is about as coalition as it gets.Nothing to do with that you twisting the whole thing.
Keating was addressing the issue of double taxation nothing to do with rich and poor.
Double taxation that's it if double tax is not applied you didn't get any thing.
If you do......its a hand out mostly for the rich they are the ones with trust accounts and big supers...... Geezuss
1. Just make dividends to taxpayers an unfranked dividend from companies pre tax, then the taxpayer pays at their marginal rate. No double taxing, done and fair.SP try again
"Nothing to do with that you twisting the whole thing.
Keating was addressing the issue of double taxation nothing to do with rich and poor.
Double taxation that's it if double tax is not applied you didn't get any thing.
If you do......its a hand out mostly for the rich they are the ones with trust accounts and big supers...... Geezuss"
Howard changed it to allow the biggest super fund holders and hidden money in trusts to benefit. That's serving the wealthy and yourself.
Yor arguments simply don't add up as why its OK for you to get a hand out but you are against.... well hand outs for nothing?
1. Just make dividends to taxpayers an unfranked dividend from companies pre tax, then the taxpayer pays at their marginal rate. No double taxing, done and fair.
2. Take the franking credits off all super funds, self managed, Industry and retail, pay the dividend post tax if the Government wants to strip the funds of the tax fine, done and fair.
Can't get simpler than that, but that wasn't the goal, you can put as much lipstick on it as you want, it's still a pig and cost Bill the P.M job and basically his career he is leaving now Albo hasn't blown his feet off.
No one like's nasty policy, with no moral compass, as was shown when he lost the unlosable election over it. That some can't see the issues, speaks volumes.
Yep typical don't answer any questions, just spray out crap, rather than answer direct questions.Great to see that you have taken it on board and understand……what’s his name….Gezzas
Absolutely, but there is no excuse for allowing incorrect information to go unchallenged, that's how urban myths perpetuate.Frankjng credits are a dead issue now, so there is no point in raking over the ashes.
Frankjng credits are a dead issue now, so there is no point in raking over the ashes.
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