The system under which Australian companies pass on to their shareholders credit for corporate income taxes paid is called a
A)double tax system.
B)classical tax system.
C)dividend imputation system.
D)franking credit.

Question

Quizplus · Accepted Answer

The dividend imputation system, also known as franking credits, is a unique tax system used in Australia. It allows companies to pass on to their shareholders credit for corporate income taxes that have been paid, thereby eliminating double taxation of corporate income. As a result, shareholders receive franking credits for the taxes already paid by the company, and they can offset these credits against their own income taxes. This helps to encourage investment and promote economic growth.

The System Under Which Australian Companies Pass on to Their