Labor ‘at it again’ in surprise move on dividends

Wilson Asset Management chairman Geoff Wilson, who“It didn’t take long for Labor to start on franking credits,” he said.“The government is trying to introduce retrospective legislation that goes back to 2016 and attempting to stop fully franked dividends from Australian companies that have paid their full amount of tax.Mr Wilson said the change would hurt fast-growing small and medium companies which raised money for working capital and paid dividends to shareholders.

“They will specifically prevent the use of artificial arrangements under which capital is raised to fund the payment of franked distributions to shareholders and enable the distribution of franking credits.”Gabriel Radzyminski: “They’d ruled out touching franking, but they’re now attacking it from another angle.”The ATO publicly warned in 2015 it was concerned about capital raisings being used to fund the streaming of “trapped” company dividends to shareholders.

The dividend imputation system works when an Australian corporate tax entity distributes profits to shareholders and can pass on a credit for company tax it has paid via a franking distribution. “Examples of capital raising activities include an underwritten dividend reinvestment plan, a placement or an underwritten rights issue.

“At a similar time to the capital raising, the company makes franked distributions to its shareholders, in a similar amount to the amount of capital raised.

socialist labor up to there old ways never trust a socialist.

It did not take Chalmers and Labor long to break their promises that won them the election. Moral of the story is you can't trust Labor/Chalmers, judge them not what they say but what they do!

Nice move. I like checking their cash flow analysis and seeing this behaviour year on year!!

I agree. I am fine with that… the capital raise should be used for CAPEX, acquisition and maintenance. Good on you AlboMP !👏👏👏

I guess it's not a Ponzi to pay existing shareholders dividends with new equity because... existing shareholders can also participate?

they should not be allowed to give dividends when the money was from new capital raising It is just a slimy way to reward investors

Retrospective legislation violates the rule of law

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