Henderson hits out at Labor’s franking credits plan

CORANGAMITE Liberal federal member Sarah Henderson has come out strongly against Labor’s proposed changes to franking credits, labelling it a “retiree tax”.

Ms Henderson claims 9,000 people in her electorate and 6,000 people in the neighbouring Labor-held electorate of Corio will each lose “an average of several thousand dollars each year”.

Labor says the change only applies to a small number of shareholders who have no tax liability and use dividend imputation credits to receive a cash refund, and 92 per cent of taxpayers will be unaffected by the policy, which will reportedly save between $5 billion and $6 billion a year.

Ms Henderson says the policy will affect both self-funded retirees as well as pensioners who took out a self-managed super fund (SMSF) after March 28, 2018 or anyone with a SMSF who becomes a pensioner after March 28 2018.

Speaking during a visit to Geelong Farm Flowers last week with Minister for Jobs and Industrial Relations Kelly O’Dwyer, Ms
Henderson said one of her constituents, Frank from Anglesea, had a total annual income of $45,000 and would lose $10,000 under Labor’s policy. She did not disclose Frank’s total assets. “It is just so dreadfully unfair and unequitable.”

Ms Henderson raised Frank’s story again on Monday’s episode of Q&A on ABC TV during discussion on Labor’s policy, which was described as “very high risk” by shareholder activist Stephen Mayne.

“I think a five to six billion dollar slug on a million Australians is extraordinary going into an election.”

Fellow panellist Zoya Patel said the policy “needed to be put in context with all the other financial penalties Australians have faced under this government”, such as cuts to penalty rates and the lowering of the HECS repayment threshold.

“I personally don’t feel that concerned about wealthy shareholders that might lose some money because they’re retirees.”

Shadow Attorney-General Mark Dreyfus dismissed the potential for political fallout.

“I don’t accept that people who are receiving this cash payment from other taxpayers’ funds from the Commonwealth are not going to vote for Labor once this is changed.”