If the Coalition get their corporate tax cuts through the people that get the franking credits will also have their franking credits reduced. Not sure why Labor didn't make something more of it.
did I mis read this (maybe u meant tax on the income being produced whilst capital remains in the fund?) I maintain that the capital held in super has already has been taxed as income years earlier. And thus should be exempt from income tax when drawn down out of the fund.
As I understand it super contributions are only taxed at 15% , so the full marginal tax on those inputs has not been paid, so maybe a discounted tax rate on earnings could apply.
As I understand it super contributions are only taxed at 15% , so the full marginal tax on those inputs has not been paid, so maybe a discounted tax rate on earnings could apply.
true again, prolly something to do with MY money (in lieu of in hand wage rise) as a 20 year old worker will be locked away for 40+ years...............do u really want to lock up someones money for more than 40 years and take away concessions for this?
Australia has had no recession for over 20 years (not that its entirely good thing).
One of only 2 countries I think. Maybe we have it right and everyone else has it wrong.
Why the hell are you looking to other countries without taking their tax system as a whole into account.
They generally have lower tax rates for dividends, eg in the USA tax on dividends is limited to 15%.
Also, that is a reason why in countries such as the USA dividends are quite small, with most companies preferring to buy back stock instead of pay dividends.
It's a big factor in why Berkshire Hathaway hasn't paid a dividend in 50 years.
They generally have lower tax rates for dividends, eg in the USA tax on dividends is limited to 15%.
Also, that is a reason why in countries such as the USA dividends are quite small, with most companies preferring to buy back stock instead of pay dividends.
It's a big factor in why Berkshire Hathaway hasn't paid a dividend in 50 years.
In Berkshires case the share price has risen from $6 per share to $290,000, by retaining all the earnings.
But, my point is simply that if companies know that as soon as they hand over the dividend check to share holders it will be taxed at 15%, there is an argument that it is not tax efficient to pay dividends.
So a lot of American companies avoid paying dividends or pay only token dividends, because they think it is better for the share holder for them to hold on to the funds and reinvest them or use the cash to buy back the companies shares, rather than have the share holder be subject to a 15% tax.
eg. If you get paid $100 in dividends, you must then pay $15 tax, so you only have $85.00 available to reinvest.
However if the company just bought back $100 of its own shares or made some other investment rather than pay you the dividend, the full $100 should accrue to your benefit.
------------------
I much prefer the Australian system.