Shorten has a ‘plasticine’ approach to tax fairness

Labor’s tax policy is not equitable for the self-funded retirees who scrimped and saved to look after themselves.

On the ABC Insiders program on Sunday, Labor opposition leader Bill Shorten highlighted his commitment to fairness. Perhaps he can explain the fairness in denying franking credits to retirees in self-managed funds but not to those in industry and retail funds. Had he treated all retirees equally there would have been an outcry and a potential loss of votes.

Shorten also fails to see the similarity between investments in property and investments in shares. Negative gearing is grandfathered, franking credits are not.

He mentioned “plasticine” governments. The franking credits measure is indeed a plasticine policy. It is not moulded on the principle of fairness but rather, under the pretence of slugging the rich, will in effect hurt financially vulnerable self-funded retirees, taxpayers whose tax payable is below their franking credits, and individuals in the tax-free bracket. Shorten talks of a taxpayer who pays no tax, but if a company pays a sum to the Australian Taxation Office on behalf of an investor, that investor then has a credit with the ATO.

Emphasising the cash nature of the refund — without fully explaining why an individual currently has a refundable credit in his name — is ambiguous, if not dishonest.

B. Della-Putta, Thorngate, SA

Bill Shorten on the ABC Insiders observed: “ It’s just not fair that a couple turning up to purchase their first home should be at a disadvantage when compared to someone turning up to purchase their sixth home. The guy with an ability to negatively gear has the financial advantage because he can claim a tax benefit”.

This statement shows the total ineptitude of the Labor policy. The first home buyer turns up with a massive financial lead. It’s called the first home owner grant and it ranges between $15,000 to $20,000 depending on the state in which the first home buyer resides. Somewhat more than the investor can achieve.

Gerry Outhwaite, Crestmead, Qld

If Bill Shorten had the principles of former UK prime minister Margaret Thatcher, we would know what to do. In her “not for turning” speech, not only was Thatcher seeking to promote policies to reduce inflation and boost employment in Britain in 1980, she was also seeking to promote, “a new independence and zest for achievement”.

It was a long time ago in a different place. What we know today, in Australia, is that Labor’s policy on dividends will help destroy independence and zest for achievement among self-funded retirees.

Neil Bach, Ringwood North, Vic

Anthony Patrick has worked his butt off all of his life and now he’s being faced with an annual income of some $61,519 should Labor win the forthcoming election. ( 4/2)

While Mr Patrick was working his butt off, I was, comparatively speaking, bludging really: only once did I work an 86-hour stint to correct a software problem within a company to avoid it having to default on a dividend payment. Three months without a single day off, to save for the deposit on a house.

Mr Patrick’s expectation of a $61,519 annual income makes me weep, while I luxuriate on something around $24,000. I have three daughters, all of whom are making honest contributions to society; I don’t have a seniors’ health card but I do have an understanding GP, which helps. Mr Patrick should be grateful for the life that he has ahead of him, rather than complaining about the potential removal of an “entitlement”.

Brian Pymont, Frenchs Forest NSW

I wonder, on the assumption that Bill Shorten were to become our next prime minister, if he would consider using that tired old expression, “governing for all Australians”? Or would he be honest enough to say: “except for those poor old coots, the self-funded retirees” — like us, who face being 20 per cent worse off through no fault of our own?

George Crowley, Mona Vale, NSW

Shadow treasurer Chris Bowen’s continuing promotion of Labor’s policy to abolish cash refunds on excess dividend imputation credits is an illustration of insensitivity to, or incomprehension of, the realities of life for the unfortunate.

If introduced, this measure would potentially reduce the earnings of many Australians who have saved diligently over their working lives to become self-funded retirees.

David Taylor, Newport, NSW