“If we want to turn this ship around and have housing as something that everyone in our community can afford,and to not have housing where it’s arguably easier to buy your second house than your first house,then you’ve got to look at the tax system.
“The capital gains tax discount and negative gearing are things we’re going to have to have a discussion about.”
Lambie agreed by saying politicians and others did not need to own multiple homes.
“Fair dinkum. I understand you want investment,and not just your super,but how many houses do you need to invest[in]?” she said.
“I just remind those people you can’t take that money with you when you’re 10 foot under. It is part of the reason we are having a housing crisis out there.”
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Greens leader Adam Bandt has urged Labor tohalt negative gearing and the capital gains tax discount to raise more tax revenue and put the money toward rent assistance and affordable housing.
Negative gearing allows taxpayers to claim deductions on their income tax for the expenses involved in owning investment property,giving them a way to save on tax while the property could gain in value. They also benefit from a tax concession on the capital gains tax they would owe upon selling the property.
Treasury said last week that rental property deductions cost $24 billion last financial year.
“Rental deductions are most commonly claimed by those with higher taxable incomes,
with individuals in the top 30 per cent of taxable income accruing 65 per cent of the total
benefit,” it said.
About 1.1 million people,or half the total number of people with rental deductions,had a rental loss during the year,which is the definition of negative gearing. These losses added up to $7.8 billion and provided a tax benefit of $2.7 billion to those taxpayers.
The concession on capital gains tax cost the budget $25 billion last financial year,but this figure includes many gains outside rental properties.
Labor unveiled a tax policy in February 2016 that would have limited negative gearing to new properties and cut the capital gains tax discount from 50 per cent to 25 per cent,but Albanesedropped this when he became Labor leader after the 2019 election.
The Coalition considered similar changes at the end of 2015 when Malcolm Turnbull was prime minister and Scott Morrison was treasurer,according to documents revealed under freedom of information law.
Its options included a cap on the dollar value of the negative gearing deductions and quarantining investment losses so they could only be deducted against investment income rather than a person’s salary and other income.
Turnbull and Morrison ruled out changes to negative gearing in early 2016 as the election neared.
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