Negative gearing changes are afoot: how would the plan affect you?

Switzer

Aug 07

The Australian Council of Trade Unions is pushing to limit negative gearing and capital gains tax discounts to just one investment property. So who stands to win or lose the most if it happens? And ...

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And ...</p>\n\n<a href=\"https://switzer.com.au/the-experts/martin-duck/negative-gearing-changes-are-afoot-how-would-the-plan-affect-you/\">Source Link</a>\n\n</div>\n","source":"switzer_stock","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Negative gearing changes are afoot: how would the plan affect you?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNegative gearing changes are afoot: how would the plan affect you?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2025-08-07 07:03 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://switzer.com.au/the-experts/martin-duck/negative-gearing-changes-are-afoot-how-would-the-plan-affect-you/><strong>Switzer</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The Australian Council of Trade Unions is pushing to limit negative gearing and capital gains tax discounts to just one investment property.\n\nSo who stands to win or lose the most if it happens? And ...</p>\n\n<a href=\"https://switzer.com.au/the-experts/martin-duck/negative-gearing-changes-are-afoot-how-would-the-plan-affect-you/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"XAO.AU","symbol_name":"标普/澳交所 普通股指数","start_time":0,"source_url":"https://switzer.com.au/the-experts/martin-duck/negative-gearing-changes-are-afoot-how-would-the-plan-affect-you/","article_id":"2557863505","we_media_id":null,"thumbnails":["https://switzer.com.au/wp-content/uploads/house.png"],"rights":{"source":"switzer_stock","url":"https://switzer.com.au/the-experts/martin-duck/negative-gearing-changes-are-afoot-how-would-the-plan-affect-you/","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2557863505","pubTimestamp":1754521416,"columns":[],"sourceInfo":{"source_id":"switzer_stock","name":"Switzer"},"weMediaInfo":null,"summary":"The Australian Council of Trade Unions is pushing to limit negative gearing and capital gains tax discounts to just one investment property. If it's brought in, how would it hit you?","collect":0,"end_time":0,"defaultTopTitle":"switzer.com.au","property":[],"viewcount":null,"language":"en","relate_stocks":{"XAO.AU":"标普/澳交所 普通股指数","XJO.AU":"标普/澳交所 200指数","ACTU":"Actuate Therapeutics Inc","BK4139":"生物科技","XKO.AU":"标普/澳交所 300指数"},"translate_title":"负面的齿轮变化正在发生：该计划将如何影响您？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ACTU":0.67,"XAO.AU":0.9,"XJO.AU":0.9,"XKO.AU":0.9},"content_text":"The Australian Council of Trade Unions is pushing to limit negative gearing and capital gains tax discounts to just one investment property.\n\nSo who stands to win or lose the most if it happens? And is the Albanese government likely to act on the proposal, given Labor has been burnt on the issue before?\nMy research on Australian housing finance shows negative gearing and capital gains tax discounts were not designed with rental housing in mind – yet this is where they’ve had their greatest impact.\nHow do the tax breaks work now – and what might change?\nUnder current negative gearing rules, investors are able to deduct losses incurred from an investment property (such as interest payments and other expenses) against their own taxable income. These can be claimed on an unlimited number of investment properties.\nHigh-income earners tend to have greater incomes to buy properties, and larger tax bills to make deductions against.\nWith the 50% capital gains tax discount, only half the increase in price of an asset is taxed when it is sold. High-income earners also tend to benefit more from this than low-income earners.\nUnder the ACTU’s proposal, the current negative gearing and capital gains tax discount arrangements would stay the same for the next five years.\nThat would give investors time to adjust their property portfolios before a change to only getting tax breaks on a single investment property.\nACTU Secretary Sally McManus is putting forward the idea at this month’s national economic reform roundtable. She warns continuing to give investors tax discounts to own multiple properties is making home ownership “nearly unimaginable for young people”.\nWho would win and lose under the proposal?\nAccording to analysis of the most recent Australian Tax Office statistics from 2022-23 by RMIT researcher Liam Davies, there were 2,261,080 individuals with an “interest in property” – meaning they have an investment in at least one rental property.\nOf those investors, 1,117,175 (49.4%) were negatively geared. And of those who were negatively geared, 810,875 have an interest in one property, and 306,300 have an interest in two or more properties.\nSo yes, there would be some losers under the ACTU proposal. About 306,300 out of 2,261,080 investors – 13.5%, or roughly one in seven property investors – would be affected by the new proposed limits. That’s just over 1% of all Australians.\nBut for the majority of other investors who negatively gear now – 810,875 people at last count – they would continue on with the same tax breaks as before.\nWhat tax breaks cost now – and what they could fund\nIt’s also worth noting that negatively geared investors “lost” (or claimed deductions for) a total of A$10.4 billion in 2022-23, with $4.8 billion being “lost” by investors with an interest in two or more properties.\nThe ACTU estimates its change would raise about $1.5 billion in tax revenue each year.\nThat money could go towards housing in other areas – such as the government’s Housing Accord target of helping finance 40,000 social and affordable homes over the next five years.\nWe’ve known for years that a tiny fraction of investors actually get the vast majority of these tax breaks.\nThe Parliamentary Budget Office has reported around 80% of the benefits of the capital gains tax discount go to the top 10% of Australian income earners, while 60% of the benefits of negative gearing go to the top 20% of income earners.\nOver the past decade, foregone revenue from negative gearing and capital gains taxation has totalled more than A$80 billion.\nTax breaks that were never meant to work this way\nNeither negative gearing nor the capital gains tax discount were initially targeted at rental housing.\nNegative gearing provisions actually date back to an unclear loophole in the 1936 Income Tax Assessment Act.\nAnd until as recently the mid-1980s – just two generations ago – there was no capital gains taxation in Australia. Back then, it was much harder for investors to get finance to buy rental properties.\nThe big change came in 1999, when then-prime minister John Howard acted on a Treasury recommendation and applied a blanket 50% discount to all assets held for a year or more.\nAt the time, the stated aim was to get more people investing in Australian businesses, such as through the share market. Instead, many people ploughed money into housing and have bid up house prices ever since.\nWhat are the prospects of change?\nWithin the past year, Labor has repeatedly ruled out changing negative gearing or the capital gains tax discount.\nLabor has been cautious about it ever since Bill Shorten’s failed 2019 election campaign, which proposed limiting negative gearing to newly-built dwellings and reducing the capital gains tax discount from 50% to 25%.\nBut the simplicity of the ACTU’s proposal – and the fact that it would leave the majority of property investors untouched – may make it simpler to implement and also easier to win over voters.\nThe Greens have already said they back the ACTU’s proposal. So if the Albanese government chose to act, it would have enough support in parliament to pass it.\nPublic support for limits on how many properties investors can own has also grown in recent years. Gen Z and Millennial voters now comprise almost half the electorate – and their most pressing concern is housing (un)affordability.\nThe ACTU’s proposal is a modest one. In the eyes of some, it won’t go far enough.\nIf the Albanese government finds the will to take on the proposal, it would have more winners than losers – and would make the housing system slightly fairer than it is now.\nMartin Duck, Post-Doctoral Research Associate, University of Sydney\nThis article is republished from The Conversation under a Creative Commons license. Read the original article.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"}}}