2016-04-24
Today the Australian Greens extend a slow clap to Malcolm Turnbull for his predictable non-announcement to keep negative gearing, which is locking thousand of first home-owners out of the housing market.
Greens co-deputy leader and spokesperson for housing Senator for WA Scott Ludlam said housing had now become a pivotal election issue and the Greens will continue to fight to scrap negative gearing.
“Malcolm Turnbull and the coalition are completely irrelevant in the tax reform and housing affordability debate,” he said.
“One third of Australians are renters and they are finding their political voice despite the best efforts of the Turnbull government to treat them as irrelevant.
“Its obvious the Turnbull Government doesn’t have the guts to make real change and reform for housing affordability and tax reform.”
The Greens have already announced a complete phase out of negative gearing and capital gains tax discount and plough some of those proceeds into affordable housing and frontline homelessness services.
Last week Senator Ludlam also launched the Rental Affordability survey with preliminary figures showing 50 per cent of renters are spending 50 per cent of their wage on rent.
12 reasons why negative gearing myths are wrong:
1. Moody's estimated negative gearing is increasing house prices by 9% - or about $44,000 - nationwide. At its peak in 2008, negative gearing added 15% to house prices.
2. Negative gearing does little to boost housing supply. In June 2013, only 5% of housing investment loans went toward construction of new dwellings.
3. There are 1.29 million Australians claiming negative gearing, but almost 4.8 million Australian renters. Many are potential first home buyers trying to save a deposit who must compete with investors.
4. Data from 1985-1987 shows beyond doubt that rents did not jump when negative gearing was temporarily removed. In fact rents fell across Melbourne, Brisbane, Adelaide, Hobart, and Canberra.
5. Investors tend to realise their investment rather than provide a long term, stable housing which impacts terribly on tenants. 25% of tenancies are terminated in the first year due to a sale, and negatively geared investors are twice as likely to sell within 12 months.
6. If investors sold their properties because negative gearing is removed, homes would be sold to renters - reducing the demand for rental properties and making no net difference to the balance of rental properties and therefore rents unchanged.
7. Negative gearing advocates use deceptive figures like ‘taxable income'; the income calculated after deductions are applied - they actually have higher incomes than quoted.
8. The more appropriate measure to use is total income. Only 12% of people earning a total income of $50,000-$100,000 (or 478,595 Australians) claim negative gearing benefits.
9. 30% of negative gearing beneficiaries earn over $500,000 a year - 55% are in the top 10% earners.
10. If negative gearing was removed, 90% of people earning $80,000 or less would be unaffected.
11. Negative gearing is one of Australia's largest and most inequitable tax expenditures. It is used more by people in higher income brackets and the ‘losses' claimed are greater as their income increases. People with higher incomes are also more likely to borrow more and claim more.
12. Up to 1.5 million Australians are living in entrenched, long-term poverty. Removing negative gearing would free up almost $3b over the next four years, and $42 billion over ten years to spend on affordable housing and other measures to alleviate poverty.
Greens rental health check survey:
http://scott-ludlam.greensmps.org.au/content/media-releases/green%E2%80%99s-rental-survey-reveals-hardship
Greens negative gearing policy
http://scott-ludlam.greensmps.org.au/campaigns/reforming-negative-gearing
Greens capital gains tax policy:
http://scott-ludlam.greensmps.org.au/content/media-releases/greens-phase-out-capital-gains-discount-2020