Dick Smith’s ideas about most things are batty-batty-cray-cray.
He’s excelled himself on this little bit of publicity-seeking:
Millionaire Australian businessman Dick Smith received $500,000 in franking credits from the government in a single year, in what he called an “outrageous” use of taxpayers’ money that should be subject to a means test.
It gets worse.
And as usual, he gets a lot wrong.
This is what he is objecting to: franking credits.
Franking describes tax credits and the system is called dividend imputation. The tax credits are valuable to entities on high tax rates and to people on lower tax rates, as any tax credit that is not used is reimbursed as cash. It only applies to Australian taxpayers; overseas investors cannot benefit.
Franking credits and the system of dividend imputation were introduced to stop company profits being taxed twice. Previously, a company would pay tax on its profit and then sometimes distribute this tax-paid profit to shareholders, who would pay tax again.
Shareholders now get a tax credit for tax the company has already paid in Australia. This means companies with revenue solely from outside Australia usually do not give out franking credits because they would not have paid tax in Australia.
Alternatively, for companies that have paid full company tax in Australia, the franking credits will be a tax credit for that profit at the company tax rate of 30 per cent.
In other words, you’re getting back tax paid on your behalf so the tax isn’t paid twice.
If Smith doesn’t want the money he can always give it to the ATO.
A bit more on Smith
When things go wrong with Smith, there’s always someone to blame.
When he closed his food brands a year ago he blamed Aldi. Read Dick Smith cons the media.
Another green scheme disaster
It’s almost as though there’s a pattern with green initiatives:
The NSW government’s solar battery program risks injury or death because of a lack of training in the industry, according to internal budget documents.
The Empowering Homes program, which was touted as an election promise in February by the Berejiklian government, provides interest-free loans for up to 300,000 households for the installation of solar-battery systems.
Budget documents obtained by the Greens show the 10-year scheme could lead to injury and death because of high installation rates and an “unprepared workforce”.
“High installation rate with an unprepared workforce, poor training, poor auditing scheme leads to injury/death/reputational damage,” the document, seen by AAP, said.