Committee Secretary Standing Committee on Economics PO Box 6021 Parliament House Canberra ACT 2600 Dear Sir/Madam, I am writing to indicate my support for the abolition of franking credit refunds. It is absurd to refund the corporate tax paid by companies to their shareholders. When the rest of the developed world was removing dividend imputation (UK in 1999, Germany in 2000, France in 2004) the Australian government doubled-down on the policy in 2000 under Howard and Costello by making excess credits refundable. Currently only 3 countries worldwide have dividend imputation (one of them is Malta) and Australia is the only country to refund these imputation credits as a cash refund from the ATO. This fully-refundable dividend imputation system has made Australian Equities artificially more attractive and has skewed the investments of retirees towards this inherently risky asset class when they should hold a more conservative and diversified portfolio – increasing their exposure to and potential damage from financial market crises and corrections. Removing refundable franking credits will not discourage people from saving, it will just restore more sensible portfolio construction. The argument around double taxation is a moot point – businesses and consumers pay tax at multiple levels of their operations and day to day lives. Working people pay income tax on their earnings as well as on their spending, they pay tolls and levies on their way to and from work. Businesses pay tax on input components, payroll taxes, as well as on profits. Taxation happens at multiple levels of the broader economy, this special exemption for shareholders should not exist. Many retirees receive large cash refunds from the ATO through their SMSFs when they have not paid tax in years. If the tax system continues to operate in this way, even the most financially successful citizens will become a net drain on the tax system by the end of their lives. This is not sustainable and is not how a progressive tax system was designed to operate. At a time when the country faces a budget deficit and growing debt burden which will be compounded further by an aging population requiring more and more from the tax payer in regards to their health, pharmaceutical and aged care costs, as well as shrinking income tax receipts resulting from outsourcing, automation and artificial intelligence, this handout to shareholders is the first cut that should be made. Carve-outs should not be made for existing pension recipients. Age pension asset thresholds should be adjusted so that individuals in genuine need of Government support are compensated. Yours Sincerely, .