Labor’s policy to stop refunds of excess franking credits is expected to raise more than $58 billion over the next ten years, if it is legislated.
Labor has released its policy costings, revealing that the franking credit policy is estimated to raise $58.197 billion out to 2029/30. Over the next four years it is estimated to raise $14.197 billion, including a cost of $103 million in 2019/20.
Labor’s policy is to stop refunds of franking credits for individuals and superannuation funds, with exemptions for most Age Pensioners and similar payment recipients.
Labor’s policy costing document says: “A Shorten Labor Government will reform dividend imputation so people who pay no income tax no longer get a cash refund simply for owning shares, in order to fund better schools and hospitals. Under Labor’s plans pensioners will be protected through a Pensioner Guarantee”.
Labor superannuation changes to raise over $5 billion
Labor’s costings of its superannuation policies show the changes will raise a net of $5.141 billion over the next four years.
A total of $5.798 billion will be raised by three measures:
- “Superannuation reforms”: $5.419 billion
- Closing the First Home Super Saver Scheme to new entrants: $373 million
- Stopping direct borrowing by super funds: $ 6 million
There is also $657 million spent over four years on “boosting women’s superannuation”.
Over ten years, changes to ‘superannuation concessions’ – which excludes some policies – is expected to raise raise $29.751 billion.
Labor says that “95% of superannuants won’t be affected by our changes to superannuation concessions”.
The Coalition is expected to release its policy costings closer to the election.