Paul Scarr (Queensland, Liberal Party) Share this | Link to this | Hansard source

I rise in relation to an article which appeared in the Australian Financial Review this morning entitled, 'Labor "at it again" in surprise move on dividends'. It's by John Kehoe, an outstanding economics editor at the Australian Financial Review. I quote from the first paragraph:

The Albanese government has shocked investors by proposing to retrospectively stop companies paying shareholders fully franked dividends that are funded by capital raisings.

What is it about the Australian Labor Party and franking credits? They just won't leave them alone.

There are three fundamental issues. There are three reasons why this proposal—this thought bubble from those opposite—is wrong. First, it is absurd, absolutely absurd, to apply retrospectivity—and this is what the exposure draft of the legislation says—all the way back to payments, distributions, which have been made at or after 12 noon by legal time in the ACT on 19 December 2016. That's more than five years ago. That's what they want the law to apply to: distributions already made to shareholders more than five years ago. It's outstanding. How can you comply with the law when you do something five years before the law's introduced? You don't have to be a constitutional lawyer to work out that there's something wrong with that.

Second, when you actually read the details of the legislation it's extraordinarily complicated with respect to effect and purpose of capital raisings. Can I give you my considered legal advice on the basis of 28 years as a commercial corporate lawyer? It's a swamp. The only people who are going to make money out of it are the tax lawyers and the tax accountants.

Third, it's totally disingenuous. It says it relies on a government announcement made in 2016 when Scott Morrison was Treasurer. We're going all the way back to that. You don't have to be Michelle Grattan to work out that if a proposal didn't come into legislation after 2016, into this place by now, it was a political dead duck.