Labor has opened a new policy divide, targeting the wealthy, sparking an immediate and furious response from the Turnbull Government.
Treasurer Scott Morrison called the policy “brutal and cruel”, accusing the Opposition of “stealing” tax refunds.
It would, he said, ignite “class warfare”.
The orchestrated government attack came even before Opposition Leader Bill Shorten announced that a Labor Government would cancel refunds to taxpayers who own shares and claim credits on their dividends.
Describing it as a “big, bold economic reform”, Mr Shorten said it would save the Budget just on $60 billion over ten years.
“The current system is weighted to the wealthy and big business,” Mr Shorten said.
“It’s not sustainable. It’s not fair.
“Mr Morrison can run all the scare campaigns he likes.”
He said the changes would improve the Budget bottom line and allow Labor to provide tax relief for low and middle income families.
The latest front in Labor’s attack on the wealthy follows announced planned changes to negative gearing and limits to capital gains tax concessions.
But Mr Morrison said the change would take Labor’s tax burden to over $200 billion.
“There are no holds barred,” he said.
“Everything you earn is up for grabs.”
Mathias Cormann called it “shifty” and a “shameless attack” on pensioners and self-funded retirees on low incomes.
It was, he said, a “massive tax grab”.
“Whatever way Bill Shorten tries to dress it up, this is a tax hit,” he said.
Shadow Treasurer, Chris Bowen, said less than one percent of full pensioners, and 92 percent of taxpayers generally, would be not affected.
Labor says the current system, set up by the Howard Government, cost the Budget just on $6 billion a year now, and would rise to $8 billion a year.
Bill Shorten also announced new write offs for businesses that invest in Australia.