Ted O'Brien (Fairfax, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer explain why it is important to back hardworking Australians who invest by ensuring that our tax system remains fair? Treasurer, what are the risks of alternative approaches that penalise Australians who carefully plan for their future?

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Fairfax for his question. We do need to back Australians in who work hard over the course of their lives and pay tax over their entire lives to build up their nest eggs so they can live as independent people in their retirement. I refer particularly to people like Bruce, who lives in the electorate of the member for Fairfax. He served 20 years in the Army. He will retire on 26 May. His total income when he retires, including a defence pension, would be around $38,000. Labor's retiree tax will take $4,000—swiping the tax refund of $4,000 from Bruce, a serviceman. You'd think Labor would respect Bruce's service. Instead, they have labelled Bruce a tax cheat. They have labelled him a millionaire, apparently, who's dipping his hands into government coffers, taking payments from other Australians. You'd think they'd respect his service. No. The Labor Party think that Bruce is the problem. They think Bruce is the person you have to deal with in the tax system. They think he's the one taking the tax system for a ride. Remember, this is the opposition that voted against the toughest multinational tax reform laws that this country has seen. They voted against them.

The problem that Labor have is that they don't understand that a tax refund is not a welfare payment. If you get the way dividend imputation and franked dividends work, all Australians should be able to offset and get the full value of the tax that has already been paid by the company. And what Labor's proposal does is say it's okay if you earn $500,000; you can get the full tax benefit of dividend imputation, but not if you're Bruce, not if you're a self-funded retiree and not if you're a pensioner who chooses to manage their own money in their own self-managed superannuation fund.

The other thing we need to understand about why Labor is imposing this tax refund theft on Australian retirees is that Labor can't control their expenditure. Labor can't put savings into a budget, so they are coming after the savings of Australians with this theft of retirees' tax refunds. It was okay two weeks ago for the shadow Treasurer to put his hand in the pockets of pensioners and it's still true today. This is an ill-considered proposal from the prince of failures on that side of the House, the shadow Treasurer.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

Mr Speaker, I ask that further questions be placed on the Notice Paper.