Limits on the size of SMSF balances, and grandfathered changes to franking credit refunds, would reduce high levels of refunds without hurting smaller trustees.

Australian share market returns will remain strong without franking credit refunds, which should be considered as the “icing on the cake” of investing in local equities.

Labor’s proposed policy to disallow franking credit refunds to certain retirees will act as a disincentive to save, according to the SMSF Association.