The title of an interesting yarn in The Sydney Morning Herald
today on housing, Landlords and speculators reap billions from tax rule changes
, sorta says it all. But in case you want details of how we’re losing from negative gearing, here are a few key points:
Tax breaks for property investors have delivered a far
greater boon to speculators than previously thought, gouging billions
from tax revenues with the benefits going overwhelmingly to the rich.
2002-03 Taxation Statistics show capital gains tax revenue plunged from
$5.3 billion to $3.3 billion in three years following radical changes
to the system in 1999. The changes were touted as revenue neutral at
The Tax Office figures, published on Friday, also show
the national negative gearing gap between rental tax deductions and
rental income more than doubled in just one year.
Landlords’ declared net profits fell from $1.74 billion in 1999-2000 to net losses of $1.37 billion in 2002-03.
figures show it is now far more tax-effective to buy and sell assets
than earn a salary, as investors receive generous tax breaks from
rental losses and further tax breaks when they sell…
Readers might also like to know that the Demographia survey on housing
affordability we quoted last week keeps popping up everywhere. The last
sighting was in the Business section of the print edition of the SMH