Wilson Asset Management (WAM) chairman and chief investment officer Geoff Wilson has called the Labor Party’s proposal to remove franking credit refunds for SMSFs as a discriminatory move that will not impact those with high levels of wealth.
Wilson made the comments in an address to SMSF trustees and investors at an event organised by the SMSF Association.
He described the proposal as ‘grossly unfair’ “because unfortunately the rich aren’t going to pay. It is the people in the middle that are getting squeezed”.
Wilson said the issue had an impact on the firm’s 80,000 investors and WAM had decided to stand with them.
“In our campaign we have seen or heard thousands of stories about people who are going to be significantly impacted by this proposal. They have done right things, lived by the rules and all of a sudden the proposal is for the goal posts to be moved,” Wilson said.
He also cast doubt on the savings which were predicted to come from the adoption of the proposal.
“The talk of over $50 billion of savings in my belief will never materialise. The people who can afford it will get advice and change their behaviour,” he said.
“It will discourage people from investing in Australian companies which employ Australians and pay Australian tax and unfortunately, a group of people who are in the middle will get negatively impacted,” Wilson added.
He concluded his comments by calling for a different approach to dealing with tax and retirement income that was not focused on a subset of the population.
“We understand we have got an aging population and as the population does age, the tax burden is falling on young, working Australians to support the aging population,” Wilson said.
“I can understand from a policy perspective we need to level the playing fields in terms of tax payment. Unfortunately, this is not the way to do it. This policy is highly discriminatory. The correct policy is one that is equitable and progressive.”