CPSA generally supports proposals to close tax loopholes and repair the Budget, but warns that the proposed dividend imputation reform may have some unintended consequences’, said Senior Policy Officer Eliza Littleton.
‘Although the dividend imputation reform will mostly affect those at the top, retirees living on a part-pension and who have investment outside super or in a self-managed super fund are likely to lose a significant amount of their income.’
‘Low-income retirees have made their retirement plans based on the understanding that they would receive these tax credits in cash. However justified dividend imputation reform may be the practical consequences for low income retirees are serious.’
‘The $59 billion of revenue raised by dividend imputation reform could really help improve social spending to support the most disadvantaged, but this can’t be done at the expense of those not much better off.’
‘CPSA urges that the tax credit cash refund must be maintained for those receiving the pension’, said Ms Littleton.