Addressing delegates at a Tax Institute event in Sydney this morning, Mr Frydenberg said that in spite of community lobbying and references in the Tax Discussion Paper, changes to the franking credits system are “not imminent”.
“We very much understand how that franking credits system is relied upon by people in their retirement. There is a discussion about it in the Discussion Paper, but it’s fair to say we don’t have big plans for changes in that area,” Mr Frydenberg said.
In addition, on the issue of overhauling the retirement income product space, Mr Frydenberg noted that at present, only a “very limited” range of annuities qualify for the tax exemption on assets supporting retirement income products.
Under the proposed new rules, concessional tax treatment would be extended to a wider range of products.
“Treasury has been working closely with stakeholders on a proposal for a new alternate set of rules. The government will consider the results of this with a view to announcing a package of changes later this year,” he said.
“While the details have yet to be fully finalised, at this stage, it’s not envisaged that SMSFs will be able to provide products under the proposed new rules.”
Dumping imputation and double taxing Australian shareholders to cut the corporate tax rate is indeed punishing Australians to give tax cuts to multinationals. Now who was talking about wicked Google, Apple, Starbucks etc?
If they were serious and wanted to remove a bias against Australian companies offshore, they would treat foreign tax credits the same way as any other tax credit and let it flow through to shareholders as imputation credits.
Dr Terry Dwyer
So true David
What “community lobbying”? The only “people” who want a change to the imputation system are the overseas investors who want to bring back the double taxing of Australian shareholders to finance a lower company tax rate to benefit themselves. Classic big end of town doublespeak.
The problem each successive government faces is that they won’t reign in expenditure (which is the true cause of budget deficits) because that’s seen as politically unpopular….and too hard for their tiny minds to grasp.
Much easier to raise taxes and blame the rich and those evil self-funded retirees.
They encourage you to put money into Super by offering tax concessions, and then take it back from you when THEY need it….while leaving their own superannuation entitlements untouched (of course).
The simple fact is that superannuation savings are a huge pot of money that will, some day, be raided because they can’t come up with a real answer to curb their wasteful ways.
What’s that old saying about foxes looking after the hen house?