Alternative Parties' Policies on NG and Property-Relevant Issues

Hi folks,

I wasn't sure where to post this, but I just finished this write-up on some examples of other political parties going in to this federal election with property-relevant policies (outside of Liberal and Labor).

Some are just plain out-there! Others are kinda cool. Interesting to see some of the other parties' views on it anyway.

These are just a handful of examples. Many parties have policies that relate to negative gearing, CGT and other economy + property things relevant to forumites here.

 

I wonder how many of these Alternative Political Party people (including the Greens) are IP investors?

The reason I ask this is because - as an IP investor myself - if I was a Pollie in a position to possibly influence people's thinking, I woulkd be trying to educate everyone about the benefits of NG, rather than trying to tear it down so that no-one has it.

Aren't we trying to get everyone to try and make plans for their own future and not be reliant on the Gubb?

Property is one of the safest ways to do that.

Other than shares, and arguably Superannuation; there aren't too many other choices which don't require a huge risk and outlay of time and/or money - businesses, but a lot of folks don't want to go down that path....Bank savings; don't even go there.

 

The problem is that Labor are not trying to tear down NG so that no one has it. They are trying to tear it down so that only relatively wealthy investors can access what amounts to NG. Lower and middle income investors will not have the same access. Labor's policy is regressive.

And for those who want to chime in that low income earners don't invest in property, that is simply not true. Of course NG overwhelmingly benefits "the rich" but that doesn't mean that low and middle income earners don't invest in property. And why replace a policy that overwhelmingly benefits "the rich" with a policy that only benefits "the rich". Seems a bit "rich" to me

 

I know it'd be expensive to execute but entire tax system reform would be the best approach to have a considered approach to NG within a broader taxation discussion.

Just like Super, Corporate Multinational (Google Tax), and many other taxes, the entire thing would need to be re-written and NG would be a part of that I guess. If either party are serious about addressing all kinds of tax avoidance and creating a more efficient system, that might be the best way to do it?

 

NG isn't tax avoidance though...you pay the tax, then get a deduction later.

It is a legal tax deduction structure, available to all folks, and approved by the Aus Gubb and the ATO as an incentive to invest and provide for your own future, and to be less of a financial burden on society, I would have thought.

Making our society cashless would cut out a lot of tax avoidance and evasion.

Taxing all Business income before it is then processed for tax deductions , and/or moving it O/S to avoid tax would be a good idea....a flat rate of X% on all turnover.

 

Let them eat cake!

 

Several gummints have undertaken widespread reviews of the tax system - none of they have had the balls to implement the recommendations.

How can state governments get away without everyone having to submit tax returns yet raise sufficient tax & other revenue to provide services?

Gotta reduce the sugar intake @Ed Barton

 

NG is a completely unnecessary tax subsidy essentially. There really isn't a good reason for it to exist other than the old "its always been there" thing. It's also not responsible for the current situation, it would be like blaming Kirbati for global warming, like I'm sure they've contributed a tiny bit to the problem but they're so inconsequential in comparison to the big players that really it's not something that should be such a topic.

Except of course for the fact that it's such an amazing red herring from the real problems such as CGT concessions and means testing exemptions that really drive the property frenzy that creates the social issues around housing affordability.

They go a step further than "not having the balls", they cherry pick the vote buying elements that don't work without the entire reform and bring them into play which just means that with each subsequent review the system just gets more and more broken. Our tax system is like a massive dam with duct tape covering all the holes and the equivalent of redneck engineering to keep up with technology, what could possibly go wrong:

 

That picture though!! Whether it be genuine-real-bogan, or fake / stitch-up it is scary hahahaa

 

I love it! I've seen people stupid enough that I believe it's real... either way I feel like it sums up how the government treat the tax system, they just grab bits and pieces and throw it together into a complete mess and hope that nothing goes wrong instead of just fixing it once and for all.

 

You are right that NG is a completely unnecessary tax subsidy, just as the 50% discount on Capital Gains Tax (CGT) is artificial. Negative gearing only really became an issue when CGT was introduced in 1985. Prior to 1999 capital gains were taxed at a real rate – the nominal return less the inflation rate over the period the investment was owned. This was changed in 1999 to a 50% discount, which made property a lot more attractive with the 50% CGT discount and NG being available on the same property.

If CGT was reformed and returned to the pre 1999 model (gains were taxed at a real rate – the nominal return less the inflation rate over the period the investment was owned), would NG be such an issue?

My issue with the current proposals to remove NG is that negatively geared investors would not be allowed to deduct losses on their investments from labour income but they would be allowed to deduct losses on their investments from other investment income. It doesn't take a genious to figure out that mum and dad are unlikely have have significant "other investment income" from which to deduct their investment losses. Only one group in Australia does

So besides rolling back CGT to the fair system that is was prior to 1999, how can NG be reformed so that the new policy does not disadvantage lower and middle income investors and advantage high income investors? There is no benefit in replacing a regressive policy with another regressive policy.

 

Correct.

Plus; noone mentions CGT exempt PPoRs as a driver of prices - roughly 70% of all houses sold..

And the Gubb never mentions GST and/or stamp duty as a driver of rising prices, and/or FHB grants.

 

Firstly, it is easy to look up what their personal finances are, you don't need to wonder. Secondly, you equate self interest with national interest.

There are many left/green leaning people on these forums who are owners of IPs.

 

Sounds like an oxymoron to me.

 

Yes, good point. I am in the process of building, so I am becoming very aware of what is pushing up the price of housing:- servicing agency costs, local government fees, state government fees and taxes, federal government fees and taxes. At this stage upon completion, if I was to sell, it looks like about 20% to 25% of the sale price would be the above. Add stamp duty on top of that and you can see why first home buyers are struggling. Hence I laugh whenever I see speculation that NG has pushed up the price of housing.

 

It is arguable that an NG change will be acting in the best interests of the Nation's housing situation...I cannot seeing it improving affordability, but might impact on future retired folks with hands out.

I wasn't interested in their Fin Statement; just their Political leaning, because - and it is a generalisation - many of these "Fringe Party" types are Left leaning, academics/professional students turned Pollie, and invariably have no real finance interest and/or assets (other than maybe PPoR, Super and a holiday house), tend to be resentful of the Haves, of the Bosses, Big Business etc, and will therefore will be more likely to try and garner Votes from the Have-nots - who are also often resentful of the Haves.

They still want our vote. Don't under-estimate the power of the Vote when these folks act...it would be marvelous if they (all Pollies) were all only focused on the greater good.

Already knew that one.

This place is not the mainstream of Left/Green folks either so I wouldn't use here as an indicator of how many Left/Green folks own IP's.

 

Money is power, power is influence, governments get influenced. There is always going to be 'loopholes' for the rich, the rich get to influence the system more than the poor.

It doesn't all work out for the best however, growing income disparity has serious implications for the rich, less income means less things consumed, means less turnover for companies, which means less shareholder returns.

There are lots of left/green voters who negatively gear. They aren't negatively gearing because the love the system, they are just logical. Its one of the best way to grow wealth, and reduce tax in the current system. It doesn't mean they don't want to change the system, or have better ideas on more efficient taxes, its just that in the meantime, that's their only logical avenue to save.
Do you expect right wing voters to withhold their income taxes because they don't agree with spending on social programs/welfare? Are right wing people only allowed to send their kids to private schools because they dont believe in free education? Do they avoid free parking spots and only use paid parking because they believe in user pays?

Vote 1 Australian Cyclist Party!