Everybody’s Home Media Release
Billions of dollars in tax breaks that push up house prices and lock people out of a home must be wound back to tackle the housing crisis and productivity, a group of housing sector advocates, economists, and union leaders have urged the government.
In a letter to the Prime Minister and Treasurer, the group has called for negative gearing and the capital gains tax (CGT) discount to be on the table at this week’s economic reform roundtable, with savings to be invested in building public and community housing.
The letter has been signed by Everybody’s Home national spokesperson Maiy Azize, ACOSS CEO Dr Cassandra Goldie AO, The Australia Institute Chief Economist Dr Greg Jericho, and ACTU Secretary Sally McManus.
Negative gearing and the capital gains tax discount are locking Australians out of secure, affordable homes. Reforming these would:
- Reduce inequality and rebalance the housing market
- Redirect billions into building new public and community housing
- Improve productivity by diverting capital to more productive uses.
Everybody’s Home national spokesperson Maiy Azize said: “Every year, billions of taxpayer dollars are handed to property investors through negative gearing and the capital gains tax discount, with everyday Australians paying the price.
“These tax breaks are among the most unfair and distortionary in our economy. They make housing less affordable, benefit higher-income Australians, and lock everyday people out of safe and affordable housing. Cutting them and using the savings to build low-cost rentals will mean more people will be able to afford a safe place to live.
“Investing in solutions that will fix the housing crisis boosts productivity in our country. Ending unfair tax breaks would not only take the heat out of the housing market and strengthen the budget but also free up funds for productive investments, like building more social housing, that will fix the housing crisis.”
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Every time I hear Albo say he’s committed to fairness and making Australians’ lives more equitable, I know he’s lying. Because the one thing that would dramatically improve the lives of the vast majority of ordinary Australians would be removing negative gearing. Young home buyers are losing houses at auctions because investors are buying them, which artifically pushes up the prices, more and more, ensuring those saving for a deposit, never quite make it. The rich are getting richer and the poor are getting poorer. And this is not a new phenomenon. It has been shown that secure housing improves the health, the wellbeing, education, better jobs and the happiness of all. Let’s make housing for the security of all Australians, not the enrichment of the already-haves. And the billions saved on negative gearing should be spent on health and education. Imagine the improvement to life in Australia in the future
Jen has strong wise words here, and we might well agree, though the quietly greedy and ambitious rarely think of others. Can we curb greed?
This Roundtable is essentially about productivity so surely it is recognised that Negative Gearing and Capital Gains tax concessions should only apply to new builds and should be phased out on investors churning existing housing.
Jen is correct and the article recognizes this anomaly in our taxation system.
Clearly the Liberals will go off like a frog-in-a-sock as they have nothing else to cling to but for the sake of fairness and equity, particularly for the younger generation we must grasp this opportunity and restrict these concessions to new builds (which is a productivity issue) and eliminate existing homes (which fails the productivity analysis).
Let’s hope so !
Well said and I hope it’s a smelly sock.
Yep. The feds only have the tax concessions really they can deal with, other than some Crown property. They should indeed get right amongst it.
Te biggest choke point, is red tape, but not that of the NCC (National Construction Code) which was ‘fingered’ at the ’roundtable’. The NCC is a vital federal organ that all states adopt – it is the essential bulwark for quality and durability only.
The real red tape ‘devil’ is in the Planning regimes, which are devised and run state-by-state. They impose enormous internecine road-blocks and hurdles across whole states and their local governments. They and various other impediments such as the over-blown Heritage Act(s), Acts governing services infrastructure development (vastly under-funded) and so-on are not integrated and streamlined to avail an efficient timely process of development to completion.
And, by way of example, in Victoria we have the utterly hopeless VBA (Victorian Building Authority), backed by a heavy smattering of state Building Acts, along with sprays of Ministerial decrees, which do more to deter residential construction than enable it.
Across the board, we have an extreme lack of Building Surveyors and Building Inspectors, who are leaving the industry in droves due to the legal liabilities they face. On top of which there has historically been a lack of qualified planners. Now just a bunch of young’ns struggling, or a residual of the olde guarde who make many errors.
Then there’s the feckless MBA (Master Builders Australia – and each state sub-org) who have sat on their hands satisfying a quasi closed-shop where it furnishes a status quo of gouging by big developer-builders, the land barons, insurers and multi-national suppliers.
These are the real impediments that need to be reformed head-on. In that regard, the current heft of the feds, must impose heavily upon the states to do so quickly.