Ev­ery re­tiree will be af­fected by changes

The Daily Telegraph (Sydney) - - Letters -

It ap­pears Bill Shorten is once again us­ing se­lec­tive ar­gu­ments, this time re­gard­ing his tax on self-funded re­tirees.

Mr Shorten’s premise about this tax only af­fect­ing a small num­ber of very wealthy peo­ple is sim­ply a lie. It will af­fect ev­ery­one with a share port­fo­lio of any size, whether re­tired or not.

Un­der a La­bor regime, there will be no re­funds from the ATO where there is a sur­plus of the frank­ing cred­its over the tax li­a­bil­ity.

If you are cur­rently in a su­per fund or draw­ing an al­lo­cated pen­sion, then there is no tax payable — so the sur­plus is 100 per cent of the frank­ing credit.

As we know, many self-funded re­tirees as well as many with shares but also re­ceiv­ing a pen­sion rely on those ATO re­funds to sup­ple­ment their in­come. And some of the re­funds might be quite mod­est. So it af­fects not just the very wealthy, but also con­trib­utes to the abil­ity to be self-funded or only partly re­liant on a pen­sion.

La­bor’s new rules mean that all self-funded re­tirees’ in­come will be re­duced.

La­bor’s at­tack on self-funded re­tirees will cer­tainly throw up un­in­tended con­se­quences and many more peo­ple will give up on su­per­an­nu­a­tion and opt for a pen­sion.

Is this the out­come the govern­ment wants?

Peter Karl­son, Cooroibah Qld

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.