FSC backs franking credit inquiry recommendations
The Financial Services Council (FSC) has backed the central recommendation of the House of Representatives Standing Committee on Economics Inquiry report into the implications of removing franking credit refunds.
The report rejected the removal of refundable franking credits on the basis that it was inequitable, but the report did not address the impact of franking credit refunds on large superannuation funds.
FSC CEO Sally Loane said the removal of franking refunds would result in the unfair treatment of millions of Australians who invest their retirement savings in some large super funds.
“A survey conducted by the FSC, and detailed in the FSC’s submission to the Inquiry, showed the removal of refunds could on average cost $850 per year for retirees in affected large funds,” Loane said.
“A removal of rebates could result in numerous super investors facing significant financial loss, and an unfair result where many self-managed super funds and some large super funds lose access to refunds - while other large funds are unaffected.”
“Despite the FSC’s reservations about the report, we nevertheless still support the main recommendation of the majority report that franking refunds should continue.”
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
