A reader has asked for the simplest possible explanation of dividend imputation and franking, as the heated debate features many people who do not understand the basics.
Tag Archives | company tax
Every day, an expert writes somewhere about the adverse impact of a reduction in franking credits due to a lower company tax rate. This tax rate has no impact on the after-tax returns received by Australian shareholders.
Imputation is seen as a costly tax break for domestic shareholders with minimal associated benefits for the overall economy, but any changes to the system should consider some broader consequences.