The Coalition government is calling Labor’s proposals to end cash payments by the taxation office for excess share dividend imputation credits a “retiree tax” and an attack on pensioners. In fact:
- No pensioners or part pensioners will be affected at all.
- Exemptions include individuals receiving the Age Pension, Disability Support Pension, Carer Payment, Parenting Payment, Newstart and Sickness Allowance.
- Self managed super funds (SMSFs) can have up to six members. Where one of a couple is receiving a part pension the exemption will apply to the fund.
- SMSF schemes set up before 28 March 2018 will be grandfathered according to Peter Martin talking on ABC RN Drive.
- Martin also pointed out that it is possible to receive a part pension with an income of up to $78,000 pa.
- Currently under the existing rules it would be theoretically possible to receive a superannuation income of $80,000 pa, and then in addition receive a cash cheque from the taxation office of about $34,000.
- These benefits flow to one in every 25 Australians, the rest of us in effect pay for them.
- When cash payments were introduced in 2001 the rule change cost the budget $550 million. The current cost is about $5 billion, $8 billion next year. It is simply unsustainable. Peter Martin says the current scheme is as Australian as the echidna. No other country in the world does it.