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Investments, Tax

Labor claims franking credit inquiry not valid

The Labor Party members of an inquiry into the impact of franking credit refunds has branded the process as a waste of money and a partisan political exercise which was not part of the remit of a parliamentary committee.

The statements were made as part of a dissenting report issued by the three Labor Party members of the House of Representatives Standing Committee on Economics which conducted an inquiry into the implications of removing refundable franking credits to certain individuals. The members were Matt Thistlethwaite, Matt Keogh, Josh Wilson.

In issuing its final report, the 10 member committee – which included six Liberal Party members of parliament (MP) – recommended against the removal of refundable franking credits but the Labor Party members used their report to challenge validity of the inquiry and accused the Liberal Party members of abuse of parliamentary procedure.

The dissenting report claimed the calling of an inquiry to investigate a proposed policy from an opposition party was ‘highly unusual’ and the purpose of the committee “is to scrutinise government legislation by conducting public inquiries and making recommendations to the Parliament regarding that legislation”.

The Labor members also claimed committee chair, Liberal MP Tim Wilson, and the Liberal Party members “colluded with private interests in order to achieve maximum political gain from this exercise”.

They allege Wilson and the other Liberal MPs worked with Wilson Asset Management to create a private website that encouraged consumers to make submissions to the committee, instead of via the committee’s homepage.

The dissenting report also called on Tim Wilson to disclose all correspondence received by the committee that was critical of the inquiry, to disclose all funders of the private website as well as any beneficiaries of the consumer information gathered by the website, and write to those consumers who used the website to apologise for misusing their personal information.

In addressing the recommendations of the report, the dissenting report claimed the proposed change would prevent people claiming a tax refund where they paid no tax, and the policy would reverse a move introduced in 2000 that undermined the pension system.

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