Children under 18 can only receive $416 tax free. Income between $416 and $1307 is taxed at 66 per cent and then the top marginal rate on income above $1307.
So while there may be some dubious merit in reviewing the franking credit situation relating to superannuation funds, thousands of small businesses will be impacted along with all those employed therein. Be careful in what you wish for by voting Labor at the next election.
Peter Toscan, Amaroo
Dump credits rort
I have read articles about the fallout from the banking royal commission and the growing ruckus over franking credits with great interest. Greed does seem to be the driving force behind both topics.
It seems to me that part of the problem behind corporate greed is the obscenely large salaries paid to CEOs. If your income is well in excess of a million dollars a year you are hardly likely to be bothered by your staff members conning people out of the odd five or $10,000.
Salaries paid to CEOs are ridiculous. No one can possibly earn (or certainly need) more than perhaps $1 million a year.
Franking credits should definitely be stopped. Like a lot of people, I bought shares during the «mum and dad floats» of the 80s and 90s. I mean, buying shares in banks and insurance companies – what could be more respectable?
I preferred shares that paid fully franked dividends when buying, being quite happy with the argument that dividends were tax-free to me «because tax had already been paid on the company profits».
Now I realise that this is a specious argument. Money that I invested to earn money should be taxed, just as rents from money invested in a rental property are taxed.
Getting rid of this rort and negative gearing should provide funds to shore up pensions and provide funding for schools and hospitals.
If companies stop paying such ridiculous salaries to their top brass, there should be a lot more to distribute among the shareholders.
Barbara Fisher, Cook
Dillon’s argument flawed
Another day and another opinion piece arguing against Labor’s franking credits changes («Labor is exploiting to be frank», February 7, p19).
There are two major flaws in the arguments used by Tony Dillon.
First he completely fails to mention company tax. In Australia tax is paid by companies on their profits. So in his example, Person A has not paid $3000 in tax, rather the company has paid $3000 in tax.
When Person A receives their $7000 dividend, the imputation credit is acknowledged to ensure that the income is not taxed again as personal income.
The system was designed to avoid double taxation, not to permit zero taxation.
Secondly, Mr Dillon uses the tactic of comparing two people who use different investment strategies and claims that each should achieve the same outcome.
Sounds fair, but it is not the way the world works. Indeed the whole financial advisory business is based on the fact that how you invest determines the outcome. An obvious example of planned difference in outcome is that income earned within a superannuation stream is treated differently to that earned outside of super.
Imagine the outcry if Labor tried to abolish the differential treatment of superannuation income. The people arguing against Labor’s plans do not really believe that all income should be treated the same way.
John Hutchison, Coombs
Howard behind mess
John Vincent is correct to observe that there are better targets for revenue raising at the big end of town than stripping refundability of imputation credits from retirees (letters, February 5).
However this does not alter the fact that a refund of tax should not be payable to those who have paid no tax.
When Paul Keating introduced dividend imputation in 1987, the credits constituted a tax rebate.
The thing that all rebates had in common was that they could directly reduce the tax payable on taxable income, but never below zero, so they could not result in a refund.
It took John Howard in his endless pursuit of pork barrelling to change this.
When Howard introduced his «A New Tax System (Mess)» tax rebates were something which had a change of name, to tax offsets, to make things appear different when they were actually the same — other examples are PAYG and provisional tax, both of which became PAYG.
It is entirely appropriate that imputation credits should return to their original status.
A reversion to the non-refundability of excess imputation credits is decidedly not a reversion to double taxation.
A company which issues fully franked dividends has paid the correct amount of tax.
The shareholder having excess imputation credits has paid no tax.
T. J. Marks, Holt
Bit of a struggle
It is hard to believe that someone would bother to hack the parliament house computers in the search for intelligence. Good luck with that.
M. Moore, Belconnen
Calling the new City Hill estate The Barracks is not appropriate
What is in a name? Whilst residential development in Civic continues to be welcome and brings greater life to the city, it seems entirely inappropriate to call the estate planned for the south west sector of City Hill, The Barracks or One City Hill at the Barracks.
The Macquarie dictionary confirms the obvious connotations of barracks as a garrison or fort for soldiers, or a large, plain building. The well known Hyde Park Barracks in the centre of Sydney, now a museum and Francis Greenway masterpiece, was a notorious male convict dormitory during the worst colonial days.
There are designated areas in Canberra where the potential lies to display symbolic, inspirational and representational qualities of the national capital.
City Hill is the municipal node of the National Triangle with all its intended significance. At present City Hill Park is neglected, although the National Capital Authority is proposing to amend the National Capital Plan to incorporate a higher City and Gateway Urban Design, including Northbourne Avenue, Civic and City Hill.
Who is responsible for nomenclature in Canberra such as The Barracks on City Hill? There are high level Commonwealth and ACT memorials and place names committees and urban design review panels.
There is an ACT government architect, the developer and the architects (the latter Sydney-based in this case).
It could well be too late to change this name because the project has been in the planning system for some time, avoiding official and public scrutiny.
Brett Odgers, Swinger Hill
The City Renewal Authority has Professor Ken Maher spruiking their West Basin Development proposal.
This comes hot on the heels of the page on West Basin included in the final City and Gateway report but not present in previous report iterations – a disingenuous move by the planners to imply consultation. It is hoped that the review promoted by Maher will fully involve the public, protect the heritage significance of Lake Burley Griffin and its parklands as a national iconic heritage feature, recognised internationally.
There is not 40km of natural lakeshore remaining as stated by Maher but West Basin has the longest strip of natural lakeshore within the three basin complex and the longest strip of beach in the entire lake.
It is hoped that the review will consider West Basin as publicly owned landscape space (with great landscape potential) that now with climate extremes and excessive city apartment living, is needed more than ever – not infilling the lake bed, not blocking significant vistas, not chopping out over 100 hundred trees, and not covering the West Basin lakeshore with heat generating concrete.
Calling Stage 2 the extension of the Stage 1 boardwalk notes the intention to destroy the beaches and riparian wildlife habitat with a mind numbing concrete boardwalk while removing possibilities for a diverse walking route sensitive to wildlife habitats that now include platypus.
Yes, improve the crossing of Parkes Way but make West Basin a state-of-the art example of a landscape area with ample social recreation uses for all ages within its inherited space rather than packing the area with apartments to create a dollar trough for the ACT government.
Juliet Ramsay, Burra, NSW
Use some horse sense
The ACT has a very dark history in management of brumbies in the Namadgi National Park.
Around 30 years ago the entire Namadgi brumby population, descended from the horses of early settlers in the area, was destroyed by ACT government authorities through a cruel aerial cull which involved lingering deaths for many horses, including foals.
Some would call this an effective cull – many others, for whom the small original brumby population had value, mourned the loss of a bit of the ACT’s heritage, and were outraged by the cruelty of the shootings.
Meanwhile 30 years on, the corroboree frogs and wetlands in our brumby-free hills are apparently still struggling.
This suggests other threats to the Namadgi, such as feral pigs and the impact of climate change should be the focus of concerns in the ACT.
Mick Gentleman should allow NSW to further develop plans for humane management rather than decimation of the Snowy brumbies and not undermine these efforts largely on ideological grounds.
Colleen Krestensen, Googong, NSW
A grand city entrance
Enlightened cities are realising the efficiency of metropolitan rail transport, and those that dismissed their original networks belatedly reinstall them (Sydney).
It is encouraging to have this form realised in Canberra before delay would increase the difficulty.
Rail travel was in the initial plan, but development lapsed in the economic slump of the 1930s and post WWII our population became overwhelmed by individual car ownership that signified enhanced personal status.
Original planning was lost and the corridor parallel to Northbourne Avenue was blocked.
Our current administration, in a determined step forward, is ignoring the lingering car prestige to construct the beginnings of a modern city transport system.
It is fitting that the first stage boldly proclaims the entrance to the city.
Despite constructional inconvenience, Northbourne Avenue is emerging as a spectacular entry, with the avenue of trees bordering the tram route which boldly proclaims our contemporary modern status in a sophisticated manner.
Inevitably, growing up can be painful, but as we emerge, the protests of the peasantry will gradually diminish.
Jack Palmer, Watson
Lack of responsibility
The article («Claims migrants forced to join union», February 7, p.1) suggests there was illegal behaviour on behalf of the unions in apparently pressuring some migrant workers to join the union.
If this indeed did happen it is really the fault of the employer who obviously demonstrated a lack of responsibility in supporting the workers.
Why did the employer allow the unions to talk to workers who apparently had little command of English?
They should have arranged for a translator to be present, so that the workers were given a full explanation.
Have the workers been given proper information about their wages and entitlements by the employer?
If anyone should be reported to the Australian Building Construction Commission it should be the employer.
Geoff Barker, Flynn
TO THE POINT
Christopher Pyne complains that politics is trapped in a «self-obsessed and panic-prone spiral». He should know. Pyne’s hi-octane interview on ABC’s Insiders program on Sunday, conducted in Barrie Cassidy’s low-key style, was a perfect example of the problem. During a 10-minute declamation in which he barely paused for breath, Pyne repeatedly dodged Cassidy’s questions and heaped ordure on his opponents.
Dr Ray Edmondson, Kambah
The economic drivel being spouted by shadow treasurer Chris Bowen confirms he attended the same school for economic clowns as Wayne Swan.
Mark Sproat, Lyons
PETROL PRICE PAIN
The ACT government may already have laws on the statute book which allows it to set petrol prices so what is the rationale for another inquiry. Successive governments have allowed petrol station sites to be redeveloped. Cook, Macquarie, Scullin and Jamison reduced from three to one comes to mind. The high prices in the ACT are called gouging. Maybe the threat to actually use the laws may get a response for the oil companies.
R. Goyne, Evatt
Pyne’s claim all 1000 refugees in offshore detention are so crook they would get medical transfer to Australia shows he can strut when sitting down.
T. Puckett, Ashgrove, Qld
The outburst by Morrison and Dutton concerning the remaining detainees from Manus Island flooding into Australia is pathetic. If Australian doctors says they need hospitalisation here in better facilities in Australia that it is sensible. This will not cause more boat people to try to get to Australia. The government still has the turn-back policy in place.
A. Jackson, Melbourne, Vic.
WHERE THERE’S SMOKE …
The sneaky way that Phillip Morris is trying to circumvent the legislation on tobacco advertising cannot be ignored. They are using a different brand with effectively the same message as previously to sponsor a racing team in the Australian Grand Prix. The government should ensure that this cannot happen.
Dr Alan Shroot, Forrest
Wouldn’t it be nice if those banks badly affected by the royal commission change their greedy culture and pass on some of that profit by giving to their customers badly affected by drought and floods.
Col Whittaker, Torrens
MATTER OF INTERPRETING
Roger Quarterman questions the background to this year’s rates notice (Letters, February 11). In most aspects of my adult life, I have had to be mindful to not wrongly interpret incompetence as malice. With this particular government I have had to be mindful to not wrongly interpret malice as incompetence.
Gordon Fyfe, Kambah