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Labor's confused and dysfunctional MIT tax grab



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THE HON JOE HOCKEY MP Shadow Treasurer

SENATOR MATHIAS CORMANN Shadow Assistant Treasurer

Wednesday, 20 June 2012

LABOR’S CONFUSED AND DYSFUNCTIONAL MIT TAX GRAB

This Labor Government is setting new records on flip flops and confusion when it comes to tax changes.

Before the May Budget, the withholding tax rate on Managed Investment Trusts (MITs) was 7.5%.

On Budget night Labor announced this rate would double to 15%.

Today, the Government chose to scrap this measure leaving it at 7.5%

However, within hours of dumping this measure, the Government has now turned around and announced that it would re-introduce legislation to Parliament at the 15% rate.

Australians deserve to know why and expect better from a dysfunctional Government.

In reality the Government has once again caved into the demands of the Greens.

In the Senate today Finance Minister Penny Wong admitted that it was pressure from the Greens that forced the government to back down on the MIT tax changes.

“The Opposition, which opposes certain savings measures, is now criticising the government for having to deal with the reality that the Opposition and the Greens may combine to stop a savings measure. That is what is occurring.”

Penny Wong, Senate Question Time 20 June 2012

While Labor may be in Government the Greens are in power.

Business cannot invest with confidence when the Government clearly has no direction.

The Coalition’s focus is on encouraging more investment through internationally competitive taxation arrangements so we can grow our economy.

The Coalition is the only side of politics that understands that stronger economic growth will deliver increased revenue to government.

[ENDS]