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Australian Federal Election - 2019

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sptrawler said:
Actually Rumpy, the death tax came from the ACTU, from memory. When Labor announced the new policies, the ACTU suggested a death tax would a better way of addressing the issue.
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Did the ACTU run any candidates in the election ?

Death tax was never Labor policy.
 
Logique said:
Why would we have elected a shadow PM & Treasurer who either:
- didn't understand imputation credits, or
- weren't telling the truth about them

I think low-salary earning PAYE workers realized they were next in line to be denied their withholding tax. "..You're not paying any tax, why should we give you a tax refund" ..they'd have been told.

Labor's proposed franking credit policy was regressive and dishonestly presented. Worst of all it would have hit poorer people the most.

We dodged the bullet of 'Chris Bowen-omics', and the relief was palpable. Away from the Ultimo latte cafes that is (they'd all have gotten franking credits)
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I think you need to brush up on tax law.
Your ideas do not wash.
 
SirRumpole said:
Is that the latest social media lie after the "death tax" ?
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hey
old mate may be slightly off track but what he says may still have merit.

labor said (for the first time in 20 years and so the first time a lot of peeps have heard this type of thinking from any potential australian government)

under labor u will do a tax return - or u will go to jail
under labor u will include credits as income and we will hold them as pre-paid tax in your name - even though u have never seen this money - or u will go to jail
under labor if we do the calculations of the tax u owe and we find you have paid too much tax for the income u earnt, then we are going to keep that excess tax money - and we will not go to jail.

i am being flippant, but that is still the message they gave.
 
SirRumpole said:
Did the ACTU run any candidates in the election ?

Death tax was never Labor policy.
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A lot of them are ex ACTU, and believe it or not, there is a perception the ACTU have a lot of say in the Labor Party.
Somewhat like everyone has a perception, big business has a big say in the Liberal Party and assume they influence them.
It's probably time to move on and regroup for the next election.
 
SirRumpole said:
Nuh, Mediscare didn't win an election.

But it seems that scare campaigns hit home with the electorate and we are going to get bags of them from now on from all sides.
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Mediscare cost seats, diminished Turnbull's authority and ultimately brought us a minority Govt.
But yeah, the Coalition were going to make that sort of thing illegal.
I guess they just didn't get around to it before the election :)
 
overhang said:
How did this couple get their savings down from 1 million to 150k? Is part of those savings counting their tax free super? Of that savings it sounds like only about 300k or so was invested in shares.

The policy was not without it's flaws, it should have been means tested and it should have been grandfathered in and slowly phased out. I would sympathize with those who have planned their whole retirement based on the franking credits as an income stream only to have the rug pulled out from under them.

But I would still like to point out it is a form of welfare, it's removed tax owed to the government by the way of company tax and given it to an individual, tax payers are subsidising these individuals. So like I said it's quite ironic that there are many on here with the nerve to attack a welfare state while simultaneously enjoying a retirement that is part paid by the tax payers purse.
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It's.
Not.
Welfare.

It's taxation policy.

By your logic, any sort of tax credit or refund is therefore welfare.

Lets suppose someone earns 50k on a wage and is taxed accordingly...12k or whatever it is, taken from your wages.

Then let's suppose that person starts a business on the side, with every intention of making a profit, but actually loses 40k in the same financial year.

That person's gross income therefore becomes 10k and subject to a 0% marginal tax rate and is due a refund of that 12k from the ATO.

Is that 12k cheque, therefore welfare?
 
sptrawler said:
As I stated in post #908 and rederob seemed to disagree with.:xyxthumbs
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I pointed out that different rules apply to accumulation and pension phases. I am actually in both, which is allowable, curiously.
Generally those in accumulation would have been exempted by Labor's proposal, so the $1,150 would have remained (having been taxed at the concessional rate).
What am I missing?
 
wayneL said:
It's.
Not.
Welfare.

It's taxation policy.

By your logic, any sort of tax credit or refund is therefore welfare.

Lets suppose someone earns 50k on a wage and is taxed accordingly...12k or whatever it is, taken from your wages.

Then let's suppose that person starts a business on the side, with every intention of making a profit, but actually loses 40k in the same financial year.

That person's gross income therefore becomes 10k and subject to a 0% marginal tax rate and is due a refund of that 12k from the ATO.

Is that 12k cheque, therefore welfare?
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Slightly different matter.

The small business person owns the company and is personally responsible for the debts of that business so the 12k cheque could be said to be a compensation for risk. A shareholder in a company has limited liability and can't be come after by debtors for company debts so maybe taxation should take that into account.
 
SirRumpole said:
Slightly different matter.

The small business person owns the company and is personally responsible for the debts of that business so the 12k cheque could be said to be a compensation for risk. A shareholder in a company has limited liability and can't be come after by debtors for company debts so maybe taxation should take that into account.
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Yes it is slightly differently in function, but not form. It is about what is considered gross taxable income and consideration of tax already paid.
 
rederob said:
I pointed out that different rules apply to accumulation and pension phases. I am actually in both, which is allowable, curiously.
Generally those in accumulation would have been exempted by Labor's proposal, so the $1,150 would have remained (having been taxed at the concessional rate).
What am I missing?
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The labor Party said, you would only receive money back if your tax was over 30%.
Up to 30% it could be used to offset tax liability.
 
wayneL said:
By your logic, any sort of tax credit or refund is therefore welfare.
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Really?
The example related to how an SMSF in retirement phase presently has all its franking credits returned by the ATO. This return negates the payment of company tax.
Example:
Company XXZ is wholly owned by retirees who have SMSFs.
XYZ pays franked dividends.
As all franking credits are returned to the SMSFs, no taxes attributable to XYZ end up as government revenue.
​
You might need to brush up on your logic.
 
rederob said:
I pointed out that different rules apply to accumulation and pension phases. I am actually in both, which is allowable, curiously.
Generally those in accumulation would have been exempted by Labor's proposal, so the $1,150 would have remained (having been taxed at the concessional rate).
What am I missing?
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hey
not my understanding of that
the proposed change was a change to taxation law, not to superannuation law. so the upshot is that the tax law would be changed to say that any tax entity could NOT get a refund if that refund was derived from imputation.

Accum accounts: the accum trust is a tax paying entity at 15% so they would have been able to offset credits against other taxable income like bank interest or rent etc, but if they had credits left over after doing that then they would have lost them under labor (no refunds for any tax entity that originate from imputation).

Industry funds: the offset for other tax on income is why the big funds (industry and retail) would be less challenged by all of that proposal - nothing to do with them being exempt or similar - and why smsf in shares would be stuffed (both accum and pension).

comment: companies at present cannot get a cash refund of excess credits, but they are able to roll forward the credits to future tax years. Individuals, and super funds, at present get a cash refund. (not sucking eggs just pointing out different tax entities get treated differently for refunds)

that is my understanding of the mechanism.
 
HelloU said:
hey
not my understanding of that
the proposed change was a change to taxation law, not to superannuation law. so the upshot is that the tax law would be changed to say that any tax entity could NOT get a refund if that refund was derived from imputation.

Accum accounts: the accum trust is a tax paying entity at 15% so they would have been able to offset credits against other taxable income like bank interest or rent etc, but if they had credits left over after doing that then they would have lost them under labor (no refunds for any tax entity that originate from imputation).

Industry funds: the offset for other tax on income is why the big funds (industry and retail) would be less challenged by all of that proposal - nothing to do with them being exempt or similar - and why smsf in shares would be stuffed (both accum and pension).

comment: companies at present cannot get a cash refund of excess credits, but they are able to roll forward the credits to future tax years. Individuals, and super funds, at present get a cash refund. (not sucking eggs just pointing out different tax entities get treated differently for refunds)

that is my understanding of the mechanism.
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Australia is the only country in the world with a fully refundable imputation system. Labor’s dividend imputation was to remain, but cash payments would no longer be made to people who managed to reduce their tax rate to zero or have paid no income tax.

Tax on company profits would continue to be paid only once in keeping with the intent of the original dividend imputation system brought in by Keating.

Labor’s reforms to excess dividend imputation credits proposed to remove a fiscally unsustainable tax arrangement seeing billions of dollars in lost revenue. Dividend imputation worked well between 1987 and 2000 when cash refunds were not sent to people who did not pay income tax. Labor proposed to reintroduce that system.
 
rederob said:
Really?
The example related to how an SMSF in retirement phase presently has all its franking credits returned by the ATO. This return negates the payment of company tax.
Example:
Company XXZ is wholly owned by retirees who have SMSFs.
XYZ pays franked dividends.
As all franking credits are returned to the SMSFs, no taxes attributable to XYZ end up as government revenue.
​
You might need to brush up on your logic.
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Robeee just make your point without the ad hom, is that possible?

I would point out the distinction between tax paid on retained company profits and those paid out as dividends to shareholders.
 
all above my pay grade, i was explaining how it would work under labor.

i like things to be simple, so here is the logic bit i struggle with about not giving a refund - if a govt is happy that a company has paid tax at the rate of 30% (and so will not refund any of that money to a low income earner) then why does that same government want more than that 30% from other tax-payers. I mean if 30% is the agreed amount of tax, then why should the tax be more than 30% for some.

i struggle with that logic.

(other countries do not include dividend income as part of the income of individual tax-payers .... for another day)
 
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