Pauline Hanson: Labor’s cuts to pensioners will be over my dead body

Many retirees are angry over Labor leader Bill Shorten’s plan to remove a tax credit cash refund, and now Pauline Hanson has sworn she’ll go in to bat for them.

Labor this week revealed plans remove the refunds available on imputation credits from people who don’t pay tax – and that ranges from the super-wealthy who have many specially designed tax-minimisation schemes at their disposal to pensioners who receive so little income that they don’t meet tax thresholds and self-funded retirees who have already paid tax on their savings.

(The refund system was designed to encourage ownership of shares in Australian-listed companies, and the credits are created so shareholders aren’t taxed twice on company profits, because companies already pay 30 per cent tax on those profits.)

While Labor says its new policy is designed to prevent the government having to give refunds to people who are hugely asset-rich or using tax-minimisation schemes, but critics say that it’s also a blow to pensioners, part-pensioners and self-funded retirees who planned their retirement incomes around being able to receive cash back from their credits on shares in Aussie companies. Former treasurer Scott Morrison called it out-and-out theft, while even senior Labor MP Anthony Albanese admitted that it would have “adverse impacts on some people”.

The only possible upside for the retirees who will lose the refund money every year is that their part-pension may increase when that private income is no longer coming in.

Read more: Labor confirms no compensation for pensioners under tax deal

Shorten’s said in an interview with ABC Radio that he’ll “have more to say about how we’ll help pensioners going forward” , pledging that pensioners would always be better off under a Labor government.

But The Australian has cited Treasury analysis of Labour’s plan that reportedly shows the biggest group of people hit by the change will be those receiving incomes of less than $18,200 a year, most of whom receive the Age Pension.

According to the analysis viewed by the newspaper, more than 610,000 people will lose an average of $1,200 a year if franking credit refunds are abolished, while just 5,000 people on incomes of more than $180,000 will be affected.

Labor says, however, that this analysis is flawed because it doesn’t include incomes that are received from superannuation.

Read more: Labour slammed over ‘tax grab’ that’ll hit pensioners, not the super-rich

Now, Pauline Hanson has vowed to block the Labor proposal in the senate if her party continues to hold the balance of power at the next senate election. Speaking to The Australian, the One Nation party leader said that Labor’s proposal was daylight robbery.

“It’s no secret Labor is making a pitch for the youth vote and has made a conscious decision to throw older Australians under the bus,” she said. Hanson said that fighting the move would be at the heart of her campaign to retain One Nation’s balance of power in the next senate elections, due in May 2019.

One Nation won more than 4 per cent of the primary vote in the 2016 senate elections. Hanson’s urging people affected by the Labor proposal to vote for her party so she retain the balance of power that would enable One Nation senators to potentially block bills.

Will a change to the franking tax credit refund rules impact your income?