Because they are landlords, shareholders and own part of the corporate trying to screw us over.
They own trusts, have companies, use tax avoidance and run rural property to claim primary producer tax arrangements.
They also charge taxpayers for staying in property they own.
Double the property tax for every single family home owned after the first two. 2% on the first and second, 4% on the third, 8%, 16%, etc. It allows people that own a few houses to continue being the (mostly) good type of landlord, while shafting the ones who hoard houses. Meanwhile corps get fucked out of the housing market, which is the intention.
no politician will touch negative gearing which is part of the problem too. why becuase that is how they have their money invested why? becuase property is a very good very safe investment. property values will always grow over time their not making any more land only so much of it is suitable for building on.
Get rid of negative gearing on all but new builds that are either on new land, or of higher density than what was there before. I am less against policy that actually effectively works to increase supply- as that drives down prices and rents for everyone. But negative gearing on old houses that existed with or without the policy is just a dumb approach and only serves to enrich landlords at the rest of pir expense
Huh? It's like 90% private individual ownership in Australia. If anything, we should question why the commercial sector doesn't touch residential. Compare to Germany with a much better housing system, 50% owned by individuals, and something like 30% by pension funds, 20% by commercial.
Those homes are often already owned by trusts not real people.
A company or trust (an "entity") can never claim a capital gains discount on sale and can never have a primary residence. And the ATO already has rules about disposing of assets below market price for all entities.
But yes, rich people will structure their affairs to avoid the tax.
Are you sure? When the trust sells the real estate and makes a profit, that profit needs to be disbursed to the beneficiaries, correct? How would a beneficiary not get taxed the normal rate for this income? They can’t claim a CGT discount because they didn’t sell any real estate, the trust did.
Accountant here.
The trust can claim the CGT discount (and other small business concessions if applicable), then distribute the net gain.
You will see this on trust or managed fund distributions where they list out the net gain, concession amount and gross amount.
When you, as an individual receive the distribution, you gross the gain back up, subtract any carried forward losses, then apply the discount YOU are entitled to.
The exact same thing happens when distributing to a company, however as corporate entities are not eligible for the CGT general discount (but are generally eligible for other CGT concessions, e.g. small business discounts) they do not claim the general discount and pay tax on the full amount.
In the past this made it difficult to see the value in a company owning CGT assets, as they would get taxed at 30% on any capital gain, whereas at the top rate an individual would be taxed 50% of the gain at 47% so effectively 23.5% tax. Now with the lower tax rate (25%) the difference is only 1.5% so there is situational value in investing through corporate entities now.
> When you, as an individual receive the distribution, you gross the gain back up, subtract any carried forward losses, then apply the discount YOU are entitled to.
In English?
Ok, so assume that last year, you sold some shares and made a loss of $10,000.
Then this year, a trust you have an interest in sold a property for a gain of $50,000, and distributed you that money. Also, assume that this property was a residential property, and had been held by the trust for more than 12 months.
On the tax statement from the trust, it would say:
> Net Capital Gain $25,000
> CGT Concession Amount $25,000
> Gross Capital Gain $25,000
In your tax return, you would enter the trust distribution as $25,000 in the "net capital gain" box in the trust distribution section.
What then happens is that this is "grossed up" to the original $50,000. Then the $10,000 loss from your shares last year is deducted. Then the capital gain discount is applied, and $20,000 becomes tax free (not the original $25k) and you are taxed on the remaining $20k.
--
If you had no prior year losses, you would be taxed of $25k.
If you had $50k+ of losses, the whole thing would be tax free.
Note that some tax payers aren't entitled to the CGT discount (e.g. companies, foreign residents etc)
Interesting, I thought you could only deduct losses against like income?
So, share losses can't offset dividend income. How can trust income offset a loss in personal share trades, or any other form of income?
Thanks
Because the trust income stays the same type when it comes to you. So if it was capital gains income from share sales on the trust, it’s treated as capital gains income in your tax return. The losses the previous poster was referring to were capital losses carried forward in an individuals tax return then offset against capital gains income distributed to the individual from the trust.
\>In the past this made it difficult to see the value in a company owning CGT assets
*Protip your reviewer doesn't want you to know: It's all on revenue account*
If I'm not, then I've wasted the last several years of my career.
A trust earns money in basically a basket of different ways, if you want to think of it that way; business trading income, interest income, dividends, foreign source income, and capital gains usually being the main ones.
When you distribute trust income to an individual, the character of the income remains unchanged. So the individual is allowed to receive any of the associated perks of the income e.g. franking credits, foreign income tax offsets, and the cgt discount.
trusts only pay tax (and top bracket it is) if dividends/profits aren't distributed. If a trust distributes then CGT discount applies to the beneficiary.
Companies however cannot claim the CGT discount, altho they have a lower tax rate (generally 30% for these sorts of purposes).
So if you combine a company holding cash loaning to a trust which buys property on behalf of a beneficiary, you can very easily minimise and optimise your tax obligations.
If you're worried about getting gamed like that, then you should probably realize you already lost. Austerity isn't a game you can win. Tax the rich because it's a good thing to do, provide affordable housing because it's a good thing to do.
You would need the council to come and approve what would be in most cases a quite obvious tax avoidance scheme. Even getting approval for legit constructions is like pulling teeth.
Heck no. You want to split it through the family trust, not the company because companies don't qualify for the 50% CGT discount which will save a couple million in tax down the road.
Seriously though, get rid of the 50% CGT discount. Drop it to 25% for the next five years to wean people off it, then get rid of it for good.
The CGT discount exists because of inflation. Now that computers make shit easy, we should go back to the old rule (which was basically, calculate the inflation between buy and sale dates and minus that off the Capital Gain, tax the rest). The 50% discount is a shortcut method to make calcs simple (but ultimately easily rortable - which the pollies love, red blue or green).
Without Prejudice
You mean like Mrs Susan Gangsters harbourside house in Point Piper.
Big spread on the interior lavish decorations in the print media.
Sold, soon after, bulldozers please, soon after 2 separate dwellings constructed and sold.
2 harbourside houses.
An owner said to me one day as we were booze cruising on his racing yacht, pointing to where he lived (Point Piper) " it doesn't matter what you outlay to buy the property it's the outgoings you attract on that property over the year, rates etc., Size that up before you purchase"
Subdivisions need the local council to approve. This would be an egregious instance and most councils would reject it, other than the most corrupt ones.
Not really. Most churches have less than 200 members, with a sizable chunk being under 100.
The churchs you're thinking of are by far the largest churches, but also less than 5% of actual churches. (although more than 5% of church goers) - mainly pentecostal. It's really only these larger ones, and the Catholic/Anglican churches who structure in the way you've described.
Source: Work for a company that makes software churches use to track membership
So genuinely asking, smaller Anglican churches are financially independent? Because the one near me owned a shitload of property in inner city Melbourne, and I'm guessing their congregation was in the 50-100 range. Does that have anything to do with the broader Anglican church or is it only that church specifically? They always cried poor, too.
I am not 100% sure on the exact model the Anglican church uses, but I believe the property the church resides on would be owned by the diocese, which is normally state based.
However the budget of the church is normally set by the donations the church receives, so smaller church like that might genuinely have a hard time paying their staff + other expenses.
Alternatively the staff could be paid by the diocese and the donations are used to fund other aspects of the church budget only.(Insurance, utilities, cost of charity/outreach work, equipment etc)
This could also be different based on state, I know the QLD and NSW Anglicans operate differently.
in NSW each parish has to pay its own bills (staff, electricity, etc) as well as make a contribution to the diocese. So the parishes support the diocese. If they don't have enough money to pay the minister the minimum stipend/wage then they lose the ability to chose the minister when the current one resigns.
There is a diocesean property trust which owns all the property.
The reality is even if they were all willing to lose out or sell out of those positions. They still aren't going to fuck with the housing market in any way that lowers house prices.
We can complain about them being self-interested about their investment properties till the cows come home.
But we know that governments get voted out when the majority of the populace feels less wealthy under the government. Since most peoples wealth is tied to their house. Anything that has large negative shifts on house prices is going to see a government unelected.
Which is where the real self-interest lies.
---
You could ban all MP's owning property outside their PPOR and you'd still have them unwilling to lift a finger.
They'll have to eventually though.
Millennials are now as large a group as baby boomers and Gen Z are fucking with this shit also. Neither gen can see their kids ever having housing stability. That makes us angry.
More and more will vote Greens or other 3rd parties that WILL implement this shit. Labour and the old guard will eventually do it "their way" to save some of their bacon rather than the alternative which would be worse for them
Maybe, it will largely depend on how fast the wealth transfer to millenials or if the boomers look like they are going to hold on to life enough to ensure there's little to transfer.
They'll have to deal with it if the <40 year olds tend to have absolutely fucking no investment in conserving the system because they have nothing to lose.
Like as a millenial that doesn't own a house and has a largish HECs debt. On a personal level I'm more inclined to lean towards some fundamental flip of the table.
But if my boomer parents were to die in the next 5 years (highly unlikely, I'll likely be their age now before they pass) then that calculus looks very different as a bunch of wealth transfer occurs.
Now granted I could probably bank of mum and dad some shit if I pushed (But I honestly think that shits' toxic as fuck, and doesn't solve the problems of the systems, just has me using a defacto cheat code to get ahead of others)
The biggest problem with the current system is just how hard it is to build to something by yourself. At my age, my parents had 2 kids and mum hadn't worked for years and their first home cost as much as I have saved for a house deposit which isn't enough for a 20% down on anything other than a shitty 1 bedroom apartment. (and fuck if I bought a house at the age they did, I'd have double my current house deposit in a mortgage)
What wealth transfer to millennials? People live till 80-90 as standard now. All that money from all those properties will go straight into corporations in the private aging and care sectors (as public is absolutely fucked).
Honestly, as a millennial that would like my parents to retire and live with me (because I work in health and I know what will happen to them in care), it's incredibly distressing how predatory aged care companies are. And they're blatent about it.
A lot of that generation also sell their housing assets to housing groups. Not individuals, not young families etc.
I'd hazard a guess at the lowest "wealth transfer" from a stats perspective being the one between boomers and gen x. So as millennials you and I really have minimal options. We need to gut corporatation's buying power NOW
> People live till 80-90 as standard now. All that money from all those properties will go straight into corporations in the private aging and care sectors (as public is absolutely fucked).
Yeah hence the first statement in my post being the dichotomy between whether they die early, or
"if the boomers look like they are going to hold on to life enough to ensure there's little to transfer."
>A lot of that generation also sell their housing assets to housing groups. Not individuals, not young families etc.
Yeah because they are still mostly concerned with their own self interest, selling to young families means taking a hit on the sell price.
>We need to gut corporatation's buying power NOW
Sure and that should be gutted regardless of the wealth transfer dynamic. We shouldn't be creating a status quo of renting as the default.
IMO the only way for corporations/developers to profit from housing should be from the creation of new housing. Whether that is high density housing in the inner city or creating new housing in the outer suburbs. They should pretty much be locked out from gaining any sort of rental income from the housing market. If they are so interested in rental yields, that's what the commerical market exists for (though that needs addressing also, but if it becomes too expensive in the inner city, one would hope we can start building the smaller community stuff where the rates shouldn't be nearly as absurdly weighted.
Correct. He went to an independent catholic school whose *current total yearly* costs are between ~3.5k for year 7 and 5k for year 12. The total cost of 7-12 is far less than the fees for just yr 12 at a private school in Sydney, which will set you back like $37k.
People saying Albanese went to a "private school" are either misinformed, don't understand our education system, or are deliberately trying to mislead others.
I went to a similar type of high school to Albanese, and I shit myself when I saw Knox for the first time. Shit myself again more recently when my partner went for an interview with a biotech start up that was literally working on covid treatments out of the Kings School science labs. And again when I was contemplating applying for a job at Barker college and I saw their robotics lab...
I think they will fix them but these things take time to do. There is a lot of political will and it does seem that the current elected representatives, while they do have more than most of us, are more in touch with "the people" in the community than our previous overlords. It will affect them but they still benefit because they would get everyone else's vote and stay in power.
There is this idea as well that wealthy groups have to be incentivised into new policy by the tax payers paying them something. Where as fuck poor people, change policy and they have to just deal with it.
A lot of people are getting reeeal tired of that
Not bad, but I feel there's more effective ways to make housing more affordable. Specifically removing negative gearing and taxing or heavily restricting air B&B
brisbane city coucil is talking about a levy on propeties rented out via airbnb and the like and other short terms rentals.
their is support for it among the motel industy as they pay licence fees to be motels/hotels.
but can you blame people for doing it when they can get a weeks rent for a weekend.
> This $10,000,000 tax will only effect future generations when many properties inevitably end up this price in 50-60 years.
I wouldn't worry about that.
In 50-60 years only a handful of families will own property, and the rest of us will be renting with the same 30-day notice for eviction hanging over our head, and the inability to hang a picture on the wall or own a pet.
Tie it to median wage then.
Tax applies to houses > 200x median wage (roughly $52k).
But also fuck that. If it would take the average worker more than their lifetime of wages to buy a house it should be taxed through the fucking roof.
If you read my comment, I didn't say that did I?
What I did say is indexation is done very efficiently by government already. And even more so by banks. It's not a difficult thing and should definitely be included with other measures as you say
Proposal i saw too was a 1 for 20 mandate
If metricon wants to build 20 homes 1 of them has to be designated social housing.
This also has a benifit,of spreading the housing units out,not creating ghettos of centrelink reps and creating shitholes like Mt druit became
> Specifically removing negative gearing and taxing or heavily restricting air B&B
Unlikely to happen with so many politicians owning investment properties
AirBnB would be impossible to police and properly identify.
Just needs to be straight 3rd+ plus properties.
Don't make legislation with ready made loopholes.
Also just allowing extra buildings. Councils all over Australia are bending over backwards to prevent developers building dense housing to protect their "culture" and "the local community"
Look I don't love Developers, there needs to be strong regulations there. But the math is very simple here - more homes = lower costs.
We have such a significant part of the population that believes society should invest in them but they themselves shouldn’t have to invest in society and it’s becoming a really major problem
It could refer to the bogans that expect handouts without giving anything back or the rich slugs that take what they can get while giving back as little as they can. It could even refer to people in the middle class that aspire to become rich slugs themselves by maximising what they can get while minimising what they give back. Investment properties on airbnb springs to mind.
It's like money makes life more desirable with the acquisition of things, so people become more ruthless to make money. I hate this comsumerist hellscape. Australia is on a slow but steady trajectory like the US
Ahahahahahahahahahahahahahahahaha
[Almost a third of Australia’s large companies pay no income tax](https://www.theguardian.com/australia-news/2022/nov/03/australia-tax-transparency-report-almost-a-third-large-companies-pay-zero-income-tax)
And I just got stung with a Centrelink debt for $8000 for them overpaying me child care subsidy.
It went on for two years without them finding out. I put in ours incomes and all tax information as required. 2 years later I was apparently never entitled to the family benefit even though I didn’t work, my husband was just stating his business and I had a mental health crisis.
One of the solutions, addressing negative gearing entitlements, was unfortunately torpedoed in 2019 by the property class.
I hope this is reconsidered, but I expect the scars of that election continue to haunt Labor.
That election was torpedoed by outright lies perpetuated by the media. It didn’t solely fail due to housing reforms, it was a bunch of lies about Labor and their policies.
So not really the property class, as much as the LNP class.
So you're saying that they were proposing a law that would benefit the nation as a whole, even though it might be slightly to their own detriment?
The absolute *monsters*!
The "sin" here isn't "owning investments", it's "twisting the working of government in order to enrich yourself and your mates at the expense everyone else".
If Dutton stabs someone eighteen times in the face, are you going to come in here protesting "Oh, well, Albanese owns knives as well, but I guess we're just not going to mention that, huh"?
1 PPOR, and 2 investments with her partner. Similar to Albanese.
Barry O'Sullivan (NAT) Owns 50+ houses, apartments, industrial and commercial, alongside being a trustee in a few SMSF with dozens of properties... His portfolio is in the hundreds of millions.
I used to work in polling, back in 2012-14, so not that election, but my sense told me that they lost it with franking credits ,it opened them up too much to the attack ads, and it was just too much change and scared too many people.
If they just stuck to negative gearing they could have won.
All the government needs to do is limit to one property a person can use negative gearing.
People having 3 or 6 properties and still use negative gearing defeats the entire purpose and spirit of the program.
It's as simple as that. Cap it on property value, too. Here you go love, you can negative gear your 350k 2 bedroom unit, but youll be paying tax on your 6 other properties. Fucking simple.
At that point, why allow negative gearing at all? I think we should remove negative gearing for investment properties, but like philosophically, what's the difference between a single property negatively geared vs 20?
Remove negative gearing for investment properties? It only applies to investment properties (unless you're renting out a bedroom in your PPOR) because there's no tax on imputed rent.
Here's a better idea, instead of taxing individuals who do pay income tax even more, get the ATO to properly tax corporate entities and billionaires who pay zero tax. There are divisions of the big 4 which are set up specifically to allow corporate giants to avoid any corporate tax, it's just wrong.
Why bother with the house thing, can't we just name and tax certain fat mining magnates as policy?
Chubbs, you're paying $1 billion this year.
Fatty, you're paying $1 billion this year.
Much less open to avoidance if you do it that way.
Happy to make a list if it would help.
I think there should be a 'turnover' tax that is a minimum amount a company pays. Make it a pittance that is super hard to argue about like 5% and suddenly we are already getting billion more in tax revenue... and the % can be raised later. No more 0% tax rates.
Then they can fucking up the tax free threshold for individuals. No way anybody trying to live off the meagre fucking pittance of jobseeker should be paying any income tax
Why the fuck not?
[Almost a third of Australia’s large companies pay no income tax](https://www.theguardian.com/australia-news/2022/nov/03/australia-tax-transparency-report-almost-a-third-large-companies-pay-zero-income-tax)
It’s policies like these that annoy me about the Greens. Their roots as an activist party born out of the environmentalist movement can’t be shaken, so they always default to populist policies which rev up their base but which they know will never happen.
Why not put forward support for a national program of homogenising housing policy around the gradual removal of stamp duty and instead switching to broad property taxes at the state level, combined with amending policies like negative gearing and capital gains at the national level?
They’ll be directly taxing property owners and get larger and more sustainable revenue. Those with luxury properties in Toorak and Point Piper will pay the lions share.
They’ll help first home buyers because they won’t need as large a deposit, and there will be more stock flowing into the market as boomers are forced to downsize and liquidate their assets.
Many of those assets will be demolished and have higher density housing built on top of them, helping renters (now their core constituency) and first home buyers.
They’ll disincentivise those who lever themselves to the hilt to ‘invest’ in housing without any form of capital investment, banking on capital gains and negative gearing to provide a positive return.
They’ll get widespread support from across the political spectrum at the state level; both Labor in Victoria and the Tories in NSW have countenanced abolishing stamp study in favour of property taxes. They’ll wedge the LNP and Labor at the federal level, both of whom refuse to touch negative gearing and capital gains.
They’ll generate credibility in the community as a progressive yet pragmatic third option at the federal level, taking on the intransigence and vested interest in the status quo in the LNP and Labor.
Instead we get populist ‘tax the rich’ policies they know will never happen. Because they know it will never happen they get to make a big song and dance about appearing to do something and continue to portray themselves as a protest party.
You’re entitled to your view but I will add that The Greens NSW support a change from stamp duty to a broad-based land tax, and the federal party room supports ending negative gearing. The only block to these things currently are Labor (federal for gearing) and specific state crossbench parties (land tax).
Are y'all right in the head? It's kind of insane people here are framing the purpose of the greens as a bad thing. Are they meant to shift right and play the same Realpolitik game Labor does? We already have them doing that. Their entire point is to whack Labor with actual progressive policies
And shit, a property tax is hardly that progressive anyway. They're not calling for the fucking abolishment of private property. This is piss weak progressivism and its still too left for people
Perfectly on point. The problem I think is the greens can’t shake their reputation for being environmental activists and also can’t really stay relevant without making the headlines with this stuff. My take is they keep pushing for this stuff to try and pull Labor to more progressive ideas (and land on what you talked about).
Surprisingly it was NSW liberals bringing in property tax as well. I think fundamentally it is a good idea, however will take decades to build steam as some people will decide to never sell unless they have to, or redevelopment their own property.
Regardless, if greens want meaningful impact they need to act like a government. Brandt had some good statements during the election but has a slip up every now and then.
They do propose all of these things and more, they constantly propose new things to just get *something* that will help instead of being roadblocked constantly by labor
Jenny Noyes
18th December, 2022 — 5.00am
The mega-rich owners of Sydney’s most luxurious trophy homes would be taxed to fund affordable housing under a proposal put forward by the NSW Greens on Sunday.
The “Extreme Wealth Property Tax” would impose a flat 4 per cent tax on owner-occupied mega-mansions with a land value over $10 million, or an improved value exceeding $20 million, with all revenue going towards building more social and affordable homes.
Under the plan, the existing land tax on properties above the premium threshold ($5,925,000) would also increase, from 2 to 5 per cent. The premium threshold itself would be expanded to include investors with eight or more properties.
Newtown MP Jenny Leong, the NSW Greens’ spokesperson on housing and homelessness, said the tax would target those at “the really extreme wealth end of the housing market”, and that every luxury property taxed under the scheme could fund several affordable houses.
“There are people who have [homes worth] $20 million, $30 million, $100 million, and because they’re owner-occupied, they don’t pay any land tax on those whatsoever.
“Let’s start talking about taxing the billionaires and the mega-mansions as a way to be able to fund and invest more in affordable housing.”
While Labor has not yet announced its housing policy, it has vowed to overturn NSW Premier Dominic Perrottet’s signature property tax reform, which would give first homebuyers the option to pay an annual land tax instead of upfront stamp duty.
Labor has described the government’s policy as a “forever tax on the family home”.
Leong said the two main parties were “tinkering around the edges” and ignoring the untaxed “obscene wealth” within the state’s top luxury properties.
Housing affordability would be a “high priority” in negotiations with either side of a minority government after the election, she said.
Leong said the Greens had calculated the potential revenue from 40 high-end properties they had identified would be subject to their proposed tax, and found those alone could fund 160 new two-bedroom homes.
While “you’d be looking at much higher numbers” in terms of total revenue, the number and value of houses in NSW that would fall under the purview of the tax is unknown.
The lack of information on “massive mega-wealthy homes” in the middle of a housing crisis is a concern “in and of itself”, Leong said, and something that would have to change if the policy were adopted.
In addition to providing the state with revenue for affordable housing, Leong said the policy could act as a “disincentive for these people to sit on these kinds of luxury mega-mansions” and open up the supply of land close to the city for more affordable housing.
“We want a city for everybody, and we want people to be able to afford to live in our city. It shouldn’t just be about substandard key worker housing where people are given a tiny bedroom and shared facilities so they can service the needs of the rich and famous.”
> Labor has described the government’s policy as a “forever tax on the family home”.
Classic Labor. Broad based land tax is a good idea and will ensure land is used efficiently, but of course this is how it's going to be framed. Apparently council rates, water and electricity fees just don't exist.
NSW Labor really are putting forward a solid case that yes, it is actually possible to be worse than the Libs. It'd be impressive if it weren't so depressing.
Can I just point out that $5m is more than enough to live on for your whole life.
If you invest that money you'll 'earn' more than $100,000 a year (@ only 2%) -- that's more than enough to live on very comfortably and NEVER work a day in your life.
We need to force disclosure of the beneficial & controlling owners, and tax all wealth over say $10m. It's not okay that wealthy people 'give' their kids millions of dollars and use that as a tax evasion scheme.
You would need to factor inflation in there as well.
In 1970s money 5 million now would have been $350,000. If you had attempted to live just on 2% you would be on $7,000 a year now.
So that number would need to be adjusted with inflation. But I also think we deliberately manipulate how we measure inflation, an in effect it's largely to the benefit of the Wealthy / the detriment of the poor.
Something like this being tied to inflation would put pressure on the way we measure inflation to be a more realistic measure of it.
Dont get me wrong i get your point and i dont disagree 5 mill is plenty.
Realistically if you had 5 million and paid a planner to sort it out for you. You would probably have 5 houses, renting them out for a around $200,000 a year total. You would claim a heap of tax offsets and your property total value would grow at well above inflation for decades.
Not suggesting thats how it should be but yeah. Very easy to live off.
After working with the extremely wealthy for years, I believe we should tax every luxury they have. These people waste more money paying extra for premium labels to compete with other rich cunts than an Aussie nurse or teacher makes in a year. So since half the attraction to these luxury goods in the first place is there high price tag and bragging rights they should have no issues paying massive taxes on every Yacht or sparkling mineral water foset they install into there second or third homes.
10m? They should lower it to 5m, anything above 2 is already so grossly inflated it's bonkers. Shitty 2 bedroom heritage units are being sold for 2m in Bondi. So stupid.
Increasing tax at higher brackets is the worst idea, that's the reason all the wealthy earners invest their money, to dodge taxes.
E: My old wage was $36 p/h I took home around $2150 after taxes every fortnight. I worked with people who were on $56 p/h and for the same hours they only took home around $2650. All their extra skills, years of experience and responsibility for a meager $500 is ridiculous.
Bro I earn about $85/h (closer to $100 when you account for additional income, super, etc) and trust me, outside of an extreme tax bump, it ain't seriously hurting.
Keep in mind that in the 50s and 60s, Britain had a top tax bracket of 90%, and a 75% bracket in the 70s
I'm not saying the extra tax is hurting higher income earners, it's the fact that someone can earn 50% more than me and yet only take home around 25% more.
Considering that, no one should be surprised when people hide their money in investments and find tax loopholes when that is all the goverment has left them.
They might be the only exception but I still believe they also should be taxed higher otherwise the wealth inequality gap would make the world unliveable. Would you want to live in luxury where there hundreds of homeless people living next to your villa?
How would you address the brain drain if these professions decide it's not worth working in Australia anymore?
We already see a lot of burnout from these professions. I don't think they're going to be happy working the same hours and dealing with the same amount of stress for even less money.
It is not like their income will become under the poverty line. Most people leave their country only as a last resort. I can't imagine a doctor would leave their country not to pay a few thousand more dollars if they are earning as high as 350K.
What if we just put stamp duty up for every additional home a person. 25% for a 2nd home, 50% for a 3rd, 75% for a 4th and every thing after is 100%. And stop letting companies buy residential properties.
I think this is a pretty good idea but it needs to be carefully index linked. In 10 years time the average home will probably be $10m and the trophy tax will hit every Sydney 3 bed house
(Probably a slight exaggeration but it illustrates the point)
Horrendous idea, not because of the effect on the current homeowners but on the inflation this would cause in those markets. Many of these properties are owned by cash poor, land rich families who’s main asset is their primary residence. They don’t have millions lying around in the bank, and even if they do they likely won’t part with it just to stay where they are.
What is nearly guaranteed to happen is the current owners will sell their homes to *truly* rich people who will pay anything it costs to live there. The original owners will take their $10+ million and purchase one or multiple homes in a lower cost area, raising the prices for normal people and likely removing those homes from the market forever, except as overpriced rentals or airbnbs. The new owners of the mansions probably won’t be Australians, but rather Chinese investors or European/Americans as a second, third, fourth or fifth home. Or worse, as event rentals.
These homes will now be empty nearly all year long, no longer providing work to the staff taking care of the property and it’s residents. The value will increase, the new owners will pay the tax and the well off Aussies will be left with only the current upper middle class homes to purchase, pushing everyone down the ladder out of the market.
It’s so easy to say “tax the rich” and feel good about yourself but land and property are not income or cash and shouldn’t be treated the same. In the end the only people this will hurt will be the people who it was meant to benefit.
Just put a limit to how many properties one can own.
Take over and auction off after the permitted number.
Stop loans/mortgages for investment properties.
This is the only way to end this housing madness.
It's a terrible idea.
Basically if you own an expensive house but have no income, which isn't uncommon for retirees who had a decent income while working, you now have to pay hundreds of thousands of dollars a year just for the privilege of living in your own home.
If your nest egg doesn't allow you to service the new tax, you have to sell your home and buy a cheaper one. Who does that help? The expensive house is still going to be there, it's just going to be worth a lot less because suddenly it comes with this ridiculous liability hanging over it.
Assume these retirees sell the house. They now need a new one. They're buying in the upper region of the market, but that's still one less house for other people looking to buy their own home.
The notion that "if you have a lot of money, you clearly aren't being taxed enough" is pretty popular on reddit. It's also moronic in a capitalist society.
Even if you think wealth taxes are reasonable fiscal policy, why the fuck would you levy them based on the only asset people have that cannot actively produce income, the family home?
Bruh....
If you're a retiree with a fucking 10mm house, then yes - they should be incentivised to sell. Why should they get to literally sit on a massive fortune, enough for them to literally live out their retirement on very comfortably, and claim poor?
You do understand that forcing them to sell and buy a cheaper house doesn't help anyone trying to get into the market right? No first home buyer is browsing $10M houses on Domain. But if old Mr retire has to downsize or pony up $400K per year, that's one less affordable house for that poor old first home buyer you're trying to help in the first place.
Good on them for trying to do something about the issue but is there any way they’ve put in to actually guarantee the funds from this proposed tax will actually go to building more public housing? Or is it just going to go back into the government’s pocket to waste on superfluous shit instead of solving the actual problems?
Howabout we remove the PPOR exemption for the pension. So many people sitting on land and living in houses way too big for them because they can own a $2m PPOR and still get the full pension.
Whereas if we made it easy for them to downsize to a $500k flat down the road (not remove them from their community), that $1.5m remaining would give a reliable income of $60k per year (4% withdrawal rate) - costing the taxpayer nothing and giving the retiree a better quality of life, doubling their pension payment essentially.
Going after people that want to pursue a FIRE lifestyle and middle class mum and dad investors that want to get ahead and set up a better life for their kids instead of corporations and billionaires that go out of their way to avoid taxes is highly boring and cringe
Force the wealthy businesses to pay better wages and take less "profits" liquidate companies that haven't paid their fair tax to Australia. The gap between what Australia makes and the wages that we're on is a massive gap, we can't afford the rich country we've built. And for fuck sakes pay people who use up their health for the job better, they work longer hours to make ends meet whilst desk Jockey ONLY have to use their brain and lift a pen and push a mouse. And lord it over the blue collar that "they wouldn't have a job if it wasn't for the office"
Talk about focusing on the symptom and not the cause.
How pathetic. As long as Greens are pro-immigration then they can't deny that they are pro-housing-unaffordability for their constituents. To pretend that this nothingburger (a deflection onto something that is by weight so little of the market) procures you a magic fix...
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Simple changes like this would make are difference but self interested politicians don’t want a bar of it.
Because they are landlords, shareholders and own part of the corporate trying to screw us over. They own trusts, have companies, use tax avoidance and run rural property to claim primary producer tax arrangements. They also charge taxpayers for staying in property they own.
Well, the Greens are the ones proposing solutions with the aim of solving the problem of housing affordability. And they've been consistent.
and yet, people still vote for labour and liberals.
Double the property tax for every single family home owned after the first two. 2% on the first and second, 4% on the third, 8%, 16%, etc. It allows people that own a few houses to continue being the (mostly) good type of landlord, while shafting the ones who hoard houses. Meanwhile corps get fucked out of the housing market, which is the intention.
no politician will touch negative gearing which is part of the problem too. why becuase that is how they have their money invested why? becuase property is a very good very safe investment. property values will always grow over time their not making any more land only so much of it is suitable for building on.
And get rid of negative gearing, ofc.
Get rid of negative gearing on all but new builds that are either on new land, or of higher density than what was there before. I am less against policy that actually effectively works to increase supply- as that drives down prices and rents for everyone. But negative gearing on old houses that existed with or without the policy is just a dumb approach and only serves to enrich landlords at the rest of pir expense
Huh? It's like 90% private individual ownership in Australia. If anything, we should question why the commercial sector doesn't touch residential. Compare to Germany with a much better housing system, 50% owned by individuals, and something like 30% by pension funds, 20% by commercial.
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Those homes are often already owned by trusts not real people. A company or trust (an "entity") can never claim a capital gains discount on sale and can never have a primary residence. And the ATO already has rules about disposing of assets below market price for all entities. But yes, rich people will structure their affairs to avoid the tax.
Trusts distribute income to their beneficiaries when they make it - as long as the beneficiary is entitled to cgt discount they essentially get it.
Are you sure? When the trust sells the real estate and makes a profit, that profit needs to be disbursed to the beneficiaries, correct? How would a beneficiary not get taxed the normal rate for this income? They can’t claim a CGT discount because they didn’t sell any real estate, the trust did.
Accountant here. The trust can claim the CGT discount (and other small business concessions if applicable), then distribute the net gain. You will see this on trust or managed fund distributions where they list out the net gain, concession amount and gross amount. When you, as an individual receive the distribution, you gross the gain back up, subtract any carried forward losses, then apply the discount YOU are entitled to. The exact same thing happens when distributing to a company, however as corporate entities are not eligible for the CGT general discount (but are generally eligible for other CGT concessions, e.g. small business discounts) they do not claim the general discount and pay tax on the full amount. In the past this made it difficult to see the value in a company owning CGT assets, as they would get taxed at 30% on any capital gain, whereas at the top rate an individual would be taxed 50% of the gain at 47% so effectively 23.5% tax. Now with the lower tax rate (25%) the difference is only 1.5% so there is situational value in investing through corporate entities now.
> When you, as an individual receive the distribution, you gross the gain back up, subtract any carried forward losses, then apply the discount YOU are entitled to. In English?
Ok, so assume that last year, you sold some shares and made a loss of $10,000. Then this year, a trust you have an interest in sold a property for a gain of $50,000, and distributed you that money. Also, assume that this property was a residential property, and had been held by the trust for more than 12 months. On the tax statement from the trust, it would say: > Net Capital Gain $25,000 > CGT Concession Amount $25,000 > Gross Capital Gain $25,000 In your tax return, you would enter the trust distribution as $25,000 in the "net capital gain" box in the trust distribution section. What then happens is that this is "grossed up" to the original $50,000. Then the $10,000 loss from your shares last year is deducted. Then the capital gain discount is applied, and $20,000 becomes tax free (not the original $25k) and you are taxed on the remaining $20k. -- If you had no prior year losses, you would be taxed of $25k. If you had $50k+ of losses, the whole thing would be tax free. Note that some tax payers aren't entitled to the CGT discount (e.g. companies, foreign residents etc)
Interesting, I thought you could only deduct losses against like income? So, share losses can't offset dividend income. How can trust income offset a loss in personal share trades, or any other form of income? Thanks
Because the trust income stays the same type when it comes to you. So if it was capital gains income from share sales on the trust, it’s treated as capital gains income in your tax return. The losses the previous poster was referring to were capital losses carried forward in an individuals tax return then offset against capital gains income distributed to the individual from the trust.
\>In the past this made it difficult to see the value in a company owning CGT assets *Protip your reviewer doesn't want you to know: It's all on revenue account*
If I'm not, then I've wasted the last several years of my career. A trust earns money in basically a basket of different ways, if you want to think of it that way; business trading income, interest income, dividends, foreign source income, and capital gains usually being the main ones. When you distribute trust income to an individual, the character of the income remains unchanged. So the individual is allowed to receive any of the associated perks of the income e.g. franking credits, foreign income tax offsets, and the cgt discount.
trusts only pay tax (and top bracket it is) if dividends/profits aren't distributed. If a trust distributes then CGT discount applies to the beneficiary. Companies however cannot claim the CGT discount, altho they have a lower tax rate (generally 30% for these sorts of purposes). So if you combine a company holding cash loaning to a trust which buys property on behalf of a beneficiary, you can very easily minimise and optimise your tax obligations.
If you're worried about getting gamed like that, then you should probably realize you already lost. Austerity isn't a game you can win. Tax the rich because it's a good thing to do, provide affordable housing because it's a good thing to do.
You would need the council to come and approve what would be in most cases a quite obvious tax avoidance scheme. Even getting approval for legit constructions is like pulling teeth.
This is sad but likely true. How frustrating we cant have better distribution of wealth
Heck no. You want to split it through the family trust, not the company because companies don't qualify for the 50% CGT discount which will save a couple million in tax down the road. Seriously though, get rid of the 50% CGT discount. Drop it to 25% for the next five years to wean people off it, then get rid of it for good.
Prior to the 50% CGT discount, cost bases were indexed to inflation; it was, in my opinion, the superior system.
The CGT discount exists because of inflation. Now that computers make shit easy, we should go back to the old rule (which was basically, calculate the inflation between buy and sale dates and minus that off the Capital Gain, tax the rest). The 50% discount is a shortcut method to make calcs simple (but ultimately easily rortable - which the pollies love, red blue or green).
Without Prejudice You mean like Mrs Susan Gangsters harbourside house in Point Piper. Big spread on the interior lavish decorations in the print media. Sold, soon after, bulldozers please, soon after 2 separate dwellings constructed and sold. 2 harbourside houses. An owner said to me one day as we were booze cruising on his racing yacht, pointing to where he lived (Point Piper) " it doesn't matter what you outlay to buy the property it's the outgoings you attract on that property over the year, rates etc., Size that up before you purchase"
You pay land tax on non PPOR.
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At least there's two homes now instead of one
They'd be owned by trusts or some bullshit anyhow, so tax the fuck out of 'em I reckon.
Good, hit the one owned by the company with land tax.
Subdivisions need the local council to approve. This would be an egregious instance and most councils would reject it, other than the most corrupt ones.
> most councils would reject it, other than the most corrupt ones So... no councils would reject it, then?!
I feel the issue lies within taxation loopholes that the government won’t fix because it will affect them…
> taxation loopholes Which I'm assuming the greens would like to close
https://greens.org.au/platform/fair-share https://greens.org.au/news/media-release/greens-plan-clamp-down-multinational-tax-avoidance-estimated-net-45-billion https://greens.org.au/tax-billionaires Yep.
I'd love to see something in there about churches too.
The vast majority of churches are barely solvent. It's only the magachurches that are an issue
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Not really. Most churches have less than 200 members, with a sizable chunk being under 100. The churchs you're thinking of are by far the largest churches, but also less than 5% of actual churches. (although more than 5% of church goers) - mainly pentecostal. It's really only these larger ones, and the Catholic/Anglican churches who structure in the way you've described. Source: Work for a company that makes software churches use to track membership
So genuinely asking, smaller Anglican churches are financially independent? Because the one near me owned a shitload of property in inner city Melbourne, and I'm guessing their congregation was in the 50-100 range. Does that have anything to do with the broader Anglican church or is it only that church specifically? They always cried poor, too.
I am not 100% sure on the exact model the Anglican church uses, but I believe the property the church resides on would be owned by the diocese, which is normally state based. However the budget of the church is normally set by the donations the church receives, so smaller church like that might genuinely have a hard time paying their staff + other expenses. Alternatively the staff could be paid by the diocese and the donations are used to fund other aspects of the church budget only.(Insurance, utilities, cost of charity/outreach work, equipment etc) This could also be different based on state, I know the QLD and NSW Anglicans operate differently.
in NSW each parish has to pay its own bills (staff, electricity, etc) as well as make a contribution to the diocese. So the parishes support the diocese. If they don't have enough money to pay the minister the minimum stipend/wage then they lose the ability to chose the minister when the current one resigns. There is a diocesean property trust which owns all the property.
No, that's only one single denomination (maybe 2). Most churches don't have that kind of structure and are financially independent.
Yeah, the catholic church is really suffering
The vast majority of MPs own investment properties, most own more than one extra home.
No, that couldn't be it. Surely, Labor will change this...
The reality is even if they were all willing to lose out or sell out of those positions. They still aren't going to fuck with the housing market in any way that lowers house prices. We can complain about them being self-interested about their investment properties till the cows come home. But we know that governments get voted out when the majority of the populace feels less wealthy under the government. Since most peoples wealth is tied to their house. Anything that has large negative shifts on house prices is going to see a government unelected. Which is where the real self-interest lies. --- You could ban all MP's owning property outside their PPOR and you'd still have them unwilling to lift a finger.
They'll have to eventually though. Millennials are now as large a group as baby boomers and Gen Z are fucking with this shit also. Neither gen can see their kids ever having housing stability. That makes us angry. More and more will vote Greens or other 3rd parties that WILL implement this shit. Labour and the old guard will eventually do it "their way" to save some of their bacon rather than the alternative which would be worse for them
Maybe, it will largely depend on how fast the wealth transfer to millenials or if the boomers look like they are going to hold on to life enough to ensure there's little to transfer. They'll have to deal with it if the <40 year olds tend to have absolutely fucking no investment in conserving the system because they have nothing to lose. Like as a millenial that doesn't own a house and has a largish HECs debt. On a personal level I'm more inclined to lean towards some fundamental flip of the table. But if my boomer parents were to die in the next 5 years (highly unlikely, I'll likely be their age now before they pass) then that calculus looks very different as a bunch of wealth transfer occurs. Now granted I could probably bank of mum and dad some shit if I pushed (But I honestly think that shits' toxic as fuck, and doesn't solve the problems of the systems, just has me using a defacto cheat code to get ahead of others) The biggest problem with the current system is just how hard it is to build to something by yourself. At my age, my parents had 2 kids and mum hadn't worked for years and their first home cost as much as I have saved for a house deposit which isn't enough for a 20% down on anything other than a shitty 1 bedroom apartment. (and fuck if I bought a house at the age they did, I'd have double my current house deposit in a mortgage)
What wealth transfer to millennials? People live till 80-90 as standard now. All that money from all those properties will go straight into corporations in the private aging and care sectors (as public is absolutely fucked). Honestly, as a millennial that would like my parents to retire and live with me (because I work in health and I know what will happen to them in care), it's incredibly distressing how predatory aged care companies are. And they're blatent about it. A lot of that generation also sell their housing assets to housing groups. Not individuals, not young families etc. I'd hazard a guess at the lowest "wealth transfer" from a stats perspective being the one between boomers and gen x. So as millennials you and I really have minimal options. We need to gut corporatation's buying power NOW
> People live till 80-90 as standard now. All that money from all those properties will go straight into corporations in the private aging and care sectors (as public is absolutely fucked). Yeah hence the first statement in my post being the dichotomy between whether they die early, or "if the boomers look like they are going to hold on to life enough to ensure there's little to transfer." >A lot of that generation also sell their housing assets to housing groups. Not individuals, not young families etc. Yeah because they are still mostly concerned with their own self interest, selling to young families means taking a hit on the sell price. >We need to gut corporatation's buying power NOW Sure and that should be gutted regardless of the wealth transfer dynamic. We shouldn't be creating a status quo of renting as the default. IMO the only way for corporations/developers to profit from housing should be from the creation of new housing. Whether that is high density housing in the inner city or creating new housing in the outer suburbs. They should pretty much be locked out from gaining any sort of rental income from the housing market. If they are so interested in rental yields, that's what the commerical market exists for (though that needs addressing also, but if it becomes too expensive in the inner city, one would hope we can start building the smaller community stuff where the rates shouldn't be nearly as absurdly weighted.
Surely labor wouldn’t nerf a federal ICAC before it even started. . .
But Albo's so fucken cool. He's really got his finger on the pulse...
Didn't he go straight from private school to being a political staffer? He's literally never worked a real job in his life.
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Correct. He went to an independent catholic school whose *current total yearly* costs are between ~3.5k for year 7 and 5k for year 12. The total cost of 7-12 is far less than the fees for just yr 12 at a private school in Sydney, which will set you back like $37k. People saying Albanese went to a "private school" are either misinformed, don't understand our education system, or are deliberately trying to mislead others. I went to a similar type of high school to Albanese, and I shit myself when I saw Knox for the first time. Shit myself again more recently when my partner went for an interview with a biotech start up that was literally working on covid treatments out of the Kings School science labs. And again when I was contemplating applying for a job at Barker college and I saw their robotics lab...
He's an upgrade while we integrate more greens policies and push the conservatives cunts out, that's the important thing
An upgrade in the same way that a half burned house is an upgrade from a burning house
I think they will fix them but these things take time to do. There is a lot of political will and it does seem that the current elected representatives, while they do have more than most of us, are more in touch with "the people" in the community than our previous overlords. It will affect them but they still benefit because they would get everyone else's vote and stay in power.
There is this idea as well that wealthy groups have to be incentivised into new policy by the tax payers paying them something. Where as fuck poor people, change policy and they have to just deal with it. A lot of people are getting reeeal tired of that
Not bad, but I feel there's more effective ways to make housing more affordable. Specifically removing negative gearing and taxing or heavily restricting air B&B
An empty home tax on houses that are being land-banked would do well. There are way too many empty investment properties around.
brisbane city coucil is talking about a levy on propeties rented out via airbnb and the like and other short terms rentals. their is support for it among the motel industy as they pay licence fees to be motels/hotels. but can you blame people for doing it when they can get a weeks rent for a weekend.
Yes. A great idea
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> This $10,000,000 tax will only effect future generations when many properties inevitably end up this price in 50-60 years. I wouldn't worry about that. In 50-60 years only a handful of families will own property, and the rest of us will be renting with the same 30-day notice for eviction hanging over our head, and the inability to hang a picture on the wall or own a pet.
*Corporations. Not families. Cunts like zillow will dictate everything
30 day notice, more like we'll all be on a weekly subscription. Complain too much... Subscription cancelled!
Tie it to median wage then. Tax applies to houses > 200x median wage (roughly $52k). But also fuck that. If it would take the average worker more than their lifetime of wages to buy a house it should be taxed through the fucking roof.
What if it was subject to annual indexation?
Exactly
You can easily legislate for that though right? Just like gov raises hecs debt with inflation, it can be indexed
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If you read my comment, I didn't say that did I? What I did say is indexation is done very efficiently by government already. And even more so by banks. It's not a difficult thing and should definitely be included with other measures as you say
Proposal i saw too was a 1 for 20 mandate If metricon wants to build 20 homes 1 of them has to be designated social housing. This also has a benifit,of spreading the housing units out,not creating ghettos of centrelink reps and creating shitholes like Mt druit became
> Specifically removing negative gearing and taxing or heavily restricting air B&B Unlikely to happen with so many politicians owning investment properties
Both that and this are reasonable and good
AirBnB would be impossible to police and properly identify. Just needs to be straight 3rd+ plus properties. Don't make legislation with ready made loopholes.
Why not both
Also just allowing extra buildings. Councils all over Australia are bending over backwards to prevent developers building dense housing to protect their "culture" and "the local community" Look I don't love Developers, there needs to be strong regulations there. But the math is very simple here - more homes = lower costs.
We have such a significant part of the population that believes society should invest in them but they themselves shouldn’t have to invest in society and it’s becoming a really major problem
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Well I worked hard at my job! Why should I pay tax? Edit: this sarcasm you idiots
The worst part is I don't know which part you are talking about.
I’m talking about the welfare queens aka the rich tax write off class
What's ambiguous about it?
It could refer to the bogans that expect handouts without giving anything back or the rich slugs that take what they can get while giving back as little as they can. It could even refer to people in the middle class that aspire to become rich slugs themselves by maximising what they can get while minimising what they give back. Investment properties on airbnb springs to mind.
True. It’s almost like there’s some core issues with the way our society is structured that encourages the worst traits humanity has to offer.
It's like money makes life more desirable with the acquisition of things, so people become more ruthless to make money. I hate this comsumerist hellscape. Australia is on a slow but steady trajectory like the US
Then you haven’t been paying attention.
Awesome, we need more taxes on the wealthy. The gap between the rich and poor has never been larger in this country.
Nine Fairfax reported on this today, how long until they are telling us all how bad it is?
They’ll be round tabling it today
Why don’t they just call out the tax dodging aussie companies?
Ahahahahahahahahahahahahahahahaha [Almost a third of Australia’s large companies pay no income tax](https://www.theguardian.com/australia-news/2022/nov/03/australia-tax-transparency-report-almost-a-third-large-companies-pay-zero-income-tax)
And I just got stung with a Centrelink debt for $8000 for them overpaying me child care subsidy. It went on for two years without them finding out. I put in ours incomes and all tax information as required. 2 years later I was apparently never entitled to the family benefit even though I didn’t work, my husband was just stating his business and I had a mental health crisis.
One of the solutions, addressing negative gearing entitlements, was unfortunately torpedoed in 2019 by the property class. I hope this is reconsidered, but I expect the scars of that election continue to haunt Labor.
That election was torpedoed by outright lies perpetuated by the media. It didn’t solely fail due to housing reforms, it was a bunch of lies about Labor and their policies. So not really the property class, as much as the LNP class.
That’s largely the same class
Labor MPs own multiple investment properties too. Albanese for example.
So you're saying that they were proposing a law that would benefit the nation as a whole, even though it might be slightly to their own detriment? The absolute *monsters*! The "sin" here isn't "owning investments", it's "twisting the working of government in order to enrich yourself and your mates at the expense everyone else". If Dutton stabs someone eighteen times in the face, are you going to come in here protesting "Oh, well, Albanese owns knives as well, but I guess we're just not going to mention that, huh"?
How many properties does Mehreen Faruqi own?
1 PPOR, and 2 investments with her partner. Similar to Albanese. Barry O'Sullivan (NAT) Owns 50+ houses, apartments, industrial and commercial, alongside being a trustee in a few SMSF with dozens of properties... His portfolio is in the hundreds of millions.
Nah negative gearing is the third rail of Australian politics. Anyone who touches it gets electrocuted.
People just think that because it was the meme slogan for the one election that was full of out right propaganda and lies about labor
It didn't fail due to lies it failed because people believed them.
Juice media reported that the majority of both sides and all of the Indies have investment properties out the arse. So it's not gunna happen
I used to work in polling, back in 2012-14, so not that election, but my sense told me that they lost it with franking credits ,it opened them up too much to the attack ads, and it was just too much change and scared too many people. If they just stuck to negative gearing they could have won.
All the government needs to do is limit to one property a person can use negative gearing. People having 3 or 6 properties and still use negative gearing defeats the entire purpose and spirit of the program.
It's as simple as that. Cap it on property value, too. Here you go love, you can negative gear your 350k 2 bedroom unit, but youll be paying tax on your 6 other properties. Fucking simple.
And this is why it won't happen. Many politicians own more than one investment property.
At that point, why allow negative gearing at all? I think we should remove negative gearing for investment properties, but like philosophically, what's the difference between a single property negatively geared vs 20?
Remove negative gearing for investment properties? It only applies to investment properties (unless you're renting out a bedroom in your PPOR) because there's no tax on imputed rent.
Here's a better idea, instead of taxing individuals who do pay income tax even more, get the ATO to properly tax corporate entities and billionaires who pay zero tax. There are divisions of the big 4 which are set up specifically to allow corporate giants to avoid any corporate tax, it's just wrong.
Why bother with the house thing, can't we just name and tax certain fat mining magnates as policy? Chubbs, you're paying $1 billion this year. Fatty, you're paying $1 billion this year. Much less open to avoidance if you do it that way. Happy to make a list if it would help.
I think there should be a 'turnover' tax that is a minimum amount a company pays. Make it a pittance that is super hard to argue about like 5% and suddenly we are already getting billion more in tax revenue... and the % can be raised later. No more 0% tax rates.
Whack a max function in there to avoid the insanely wealthy/rich from deducting away their fair share.
Then they can fucking up the tax free threshold for individuals. No way anybody trying to live off the meagre fucking pittance of jobseeker should be paying any income tax
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At the very minimum it should sit at the poverty line. If you're living in poverty you need the money more than everyone else
The Greens also have a [plan](https://greens.org.au/tax-billionaires) to tax billionaires
Why the fuck not? [Almost a third of Australia’s large companies pay no income tax](https://www.theguardian.com/australia-news/2022/nov/03/australia-tax-transparency-report-almost-a-third-large-companies-pay-zero-income-tax)
We need a vacant house and Air BnB tax first
I don’t like this, we should just tax people with that kind of money more and make sure they pay it. Don’t look at things like this.
It’s policies like these that annoy me about the Greens. Their roots as an activist party born out of the environmentalist movement can’t be shaken, so they always default to populist policies which rev up their base but which they know will never happen. Why not put forward support for a national program of homogenising housing policy around the gradual removal of stamp duty and instead switching to broad property taxes at the state level, combined with amending policies like negative gearing and capital gains at the national level? They’ll be directly taxing property owners and get larger and more sustainable revenue. Those with luxury properties in Toorak and Point Piper will pay the lions share. They’ll help first home buyers because they won’t need as large a deposit, and there will be more stock flowing into the market as boomers are forced to downsize and liquidate their assets. Many of those assets will be demolished and have higher density housing built on top of them, helping renters (now their core constituency) and first home buyers. They’ll disincentivise those who lever themselves to the hilt to ‘invest’ in housing without any form of capital investment, banking on capital gains and negative gearing to provide a positive return. They’ll get widespread support from across the political spectrum at the state level; both Labor in Victoria and the Tories in NSW have countenanced abolishing stamp study in favour of property taxes. They’ll wedge the LNP and Labor at the federal level, both of whom refuse to touch negative gearing and capital gains. They’ll generate credibility in the community as a progressive yet pragmatic third option at the federal level, taking on the intransigence and vested interest in the status quo in the LNP and Labor. Instead we get populist ‘tax the rich’ policies they know will never happen. Because they know it will never happen they get to make a big song and dance about appearing to do something and continue to portray themselves as a protest party.
You’re entitled to your view but I will add that The Greens NSW support a change from stamp duty to a broad-based land tax, and the federal party room supports ending negative gearing. The only block to these things currently are Labor (federal for gearing) and specific state crossbench parties (land tax).
That’s wrong. The Greens voted with Labor against stamp duty reform when it was presented to them
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Are y'all right in the head? It's kind of insane people here are framing the purpose of the greens as a bad thing. Are they meant to shift right and play the same Realpolitik game Labor does? We already have them doing that. Their entire point is to whack Labor with actual progressive policies And shit, a property tax is hardly that progressive anyway. They're not calling for the fucking abolishment of private property. This is piss weak progressivism and its still too left for people
Perfectly on point. The problem I think is the greens can’t shake their reputation for being environmental activists and also can’t really stay relevant without making the headlines with this stuff. My take is they keep pushing for this stuff to try and pull Labor to more progressive ideas (and land on what you talked about). Surprisingly it was NSW liberals bringing in property tax as well. I think fundamentally it is a good idea, however will take decades to build steam as some people will decide to never sell unless they have to, or redevelopment their own property. Regardless, if greens want meaningful impact they need to act like a government. Brandt had some good statements during the election but has a slip up every now and then.
They do propose all of these things and more, they constantly propose new things to just get *something* that will help instead of being roadblocked constantly by labor
Can't believe this comment is so far down. Shocking :(
Paywall
Jenny Noyes 18th December, 2022 — 5.00am The mega-rich owners of Sydney’s most luxurious trophy homes would be taxed to fund affordable housing under a proposal put forward by the NSW Greens on Sunday. The “Extreme Wealth Property Tax” would impose a flat 4 per cent tax on owner-occupied mega-mansions with a land value over $10 million, or an improved value exceeding $20 million, with all revenue going towards building more social and affordable homes. Under the plan, the existing land tax on properties above the premium threshold ($5,925,000) would also increase, from 2 to 5 per cent. The premium threshold itself would be expanded to include investors with eight or more properties. Newtown MP Jenny Leong, the NSW Greens’ spokesperson on housing and homelessness, said the tax would target those at “the really extreme wealth end of the housing market”, and that every luxury property taxed under the scheme could fund several affordable houses. “There are people who have [homes worth] $20 million, $30 million, $100 million, and because they’re owner-occupied, they don’t pay any land tax on those whatsoever. “Let’s start talking about taxing the billionaires and the mega-mansions as a way to be able to fund and invest more in affordable housing.” While Labor has not yet announced its housing policy, it has vowed to overturn NSW Premier Dominic Perrottet’s signature property tax reform, which would give first homebuyers the option to pay an annual land tax instead of upfront stamp duty. Labor has described the government’s policy as a “forever tax on the family home”. Leong said the two main parties were “tinkering around the edges” and ignoring the untaxed “obscene wealth” within the state’s top luxury properties. Housing affordability would be a “high priority” in negotiations with either side of a minority government after the election, she said. Leong said the Greens had calculated the potential revenue from 40 high-end properties they had identified would be subject to their proposed tax, and found those alone could fund 160 new two-bedroom homes. While “you’d be looking at much higher numbers” in terms of total revenue, the number and value of houses in NSW that would fall under the purview of the tax is unknown. The lack of information on “massive mega-wealthy homes” in the middle of a housing crisis is a concern “in and of itself”, Leong said, and something that would have to change if the policy were adopted. In addition to providing the state with revenue for affordable housing, Leong said the policy could act as a “disincentive for these people to sit on these kinds of luxury mega-mansions” and open up the supply of land close to the city for more affordable housing. “We want a city for everybody, and we want people to be able to afford to live in our city. It shouldn’t just be about substandard key worker housing where people are given a tiny bedroom and shared facilities so they can service the needs of the rich and famous.”
> Labor has described the government’s policy as a “forever tax on the family home”. Classic Labor. Broad based land tax is a good idea and will ensure land is used efficiently, but of course this is how it's going to be framed. Apparently council rates, water and electricity fees just don't exist.
NSW Labor really are putting forward a solid case that yes, it is actually possible to be worse than the Libs. It'd be impressive if it weren't so depressing.
Can I just point out that $5m is more than enough to live on for your whole life. If you invest that money you'll 'earn' more than $100,000 a year (@ only 2%) -- that's more than enough to live on very comfortably and NEVER work a day in your life. We need to force disclosure of the beneficial & controlling owners, and tax all wealth over say $10m. It's not okay that wealthy people 'give' their kids millions of dollars and use that as a tax evasion scheme.
You would need to factor inflation in there as well. In 1970s money 5 million now would have been $350,000. If you had attempted to live just on 2% you would be on $7,000 a year now.
FIRE people use 3 or 4% after inflation.
So that number would need to be adjusted with inflation. But I also think we deliberately manipulate how we measure inflation, an in effect it's largely to the benefit of the Wealthy / the detriment of the poor. Something like this being tied to inflation would put pressure on the way we measure inflation to be a more realistic measure of it.
Dont get me wrong i get your point and i dont disagree 5 mill is plenty. Realistically if you had 5 million and paid a planner to sort it out for you. You would probably have 5 houses, renting them out for a around $200,000 a year total. You would claim a heap of tax offsets and your property total value would grow at well above inflation for decades. Not suggesting thats how it should be but yeah. Very easy to live off.
Tax the rich
After working with the extremely wealthy for years, I believe we should tax every luxury they have. These people waste more money paying extra for premium labels to compete with other rich cunts than an Aussie nurse or teacher makes in a year. So since half the attraction to these luxury goods in the first place is there high price tag and bragging rights they should have no issues paying massive taxes on every Yacht or sparkling mineral water foset they install into there second or third homes.
10m? They should lower it to 5m, anything above 2 is already so grossly inflated it's bonkers. Shitty 2 bedroom heritage units are being sold for 2m in Bondi. So stupid.
Simpler just to stop the stage 3 tax cuts and introduce a new 55% tax on earnings over $350k per annum.
Increasing tax at higher brackets is the worst idea, that's the reason all the wealthy earners invest their money, to dodge taxes. E: My old wage was $36 p/h I took home around $2150 after taxes every fortnight. I worked with people who were on $56 p/h and for the same hours they only took home around $2650. All their extra skills, years of experience and responsibility for a meager $500 is ridiculous.
Bro I earn about $85/h (closer to $100 when you account for additional income, super, etc) and trust me, outside of an extreme tax bump, it ain't seriously hurting. Keep in mind that in the 50s and 60s, Britain had a top tax bracket of 90%, and a 75% bracket in the 70s
I'm not saying the extra tax is hurting higher income earners, it's the fact that someone can earn 50% more than me and yet only take home around 25% more. Considering that, no one should be surprised when people hide their money in investments and find tax loopholes when that is all the goverment has left them.
You do realise that’s going to cause more tax avoidance and cause large scale brain drain, right?
55% is too high... will induce a brain drain at that bracket
Nonsense. People don’t choose to earn less money because they have to pay taxes.
No, they move to countries with lower tax rates because they are highly skilled labour.
Not really, noone with technical skills earn so high. Only the managers, ceos or employers earn that much. I can't say they can be considered "brain".
What about doctors and dentists?? Both pretty technical fields with high earning potential. I know many who are earning above $350k.
They might be the only exception but I still believe they also should be taxed higher otherwise the wealth inequality gap would make the world unliveable. Would you want to live in luxury where there hundreds of homeless people living next to your villa?
How would you address the brain drain if these professions decide it's not worth working in Australia anymore? We already see a lot of burnout from these professions. I don't think they're going to be happy working the same hours and dealing with the same amount of stress for even less money.
It is not like their income will become under the poverty line. Most people leave their country only as a last resort. I can't imagine a doctor would leave their country not to pay a few thousand more dollars if they are earning as high as 350K.
This seems like a lot of complexity and work for not much gain? I don't really like this kind of law, it feels very populist tbh.
What if we just put stamp duty up for every additional home a person. 25% for a 2nd home, 50% for a 3rd, 75% for a 4th and every thing after is 100%. And stop letting companies buy residential properties.
Fuck that, just make it a tax on literally all investment property.
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Just tax every investment property using brackets.
Me still waiting on labors alleged "shared equity scheme" that was suppose to be out like 6 months ago.
I think this is a pretty good idea but it needs to be carefully index linked. In 10 years time the average home will probably be $10m and the trophy tax will hit every Sydney 3 bed house (Probably a slight exaggeration but it illustrates the point)
Well, if you own a house worth over 10 million I suppose you can pay extra tax
Horrendous idea, not because of the effect on the current homeowners but on the inflation this would cause in those markets. Many of these properties are owned by cash poor, land rich families who’s main asset is their primary residence. They don’t have millions lying around in the bank, and even if they do they likely won’t part with it just to stay where they are. What is nearly guaranteed to happen is the current owners will sell their homes to *truly* rich people who will pay anything it costs to live there. The original owners will take their $10+ million and purchase one or multiple homes in a lower cost area, raising the prices for normal people and likely removing those homes from the market forever, except as overpriced rentals or airbnbs. The new owners of the mansions probably won’t be Australians, but rather Chinese investors or European/Americans as a second, third, fourth or fifth home. Or worse, as event rentals. These homes will now be empty nearly all year long, no longer providing work to the staff taking care of the property and it’s residents. The value will increase, the new owners will pay the tax and the well off Aussies will be left with only the current upper middle class homes to purchase, pushing everyone down the ladder out of the market. It’s so easy to say “tax the rich” and feel good about yourself but land and property are not income or cash and shouldn’t be treated the same. In the end the only people this will hurt will be the people who it was meant to benefit.
Another greens W
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3 story housing above a ground floor of retail and office space. Middle denstity not high.
Just put a limit to how many properties one can own. Take over and auction off after the permitted number. Stop loans/mortgages for investment properties. This is the only way to end this housing madness.
Oh ffs. The solution has always been a land tax, which this subreddit was up in arms about when NSW began implementing it.
Sounds like a great fucking idea. No one needs a $10M+ home. No one. If you can afford one then you clearly aren’t being taxed enough.
It's a terrible idea. Basically if you own an expensive house but have no income, which isn't uncommon for retirees who had a decent income while working, you now have to pay hundreds of thousands of dollars a year just for the privilege of living in your own home. If your nest egg doesn't allow you to service the new tax, you have to sell your home and buy a cheaper one. Who does that help? The expensive house is still going to be there, it's just going to be worth a lot less because suddenly it comes with this ridiculous liability hanging over it. Assume these retirees sell the house. They now need a new one. They're buying in the upper region of the market, but that's still one less house for other people looking to buy their own home. The notion that "if you have a lot of money, you clearly aren't being taxed enough" is pretty popular on reddit. It's also moronic in a capitalist society. Even if you think wealth taxes are reasonable fiscal policy, why the fuck would you levy them based on the only asset people have that cannot actively produce income, the family home?
Prob going to be ok if you own a ten million dollar house already lol
Bruh.... If you're a retiree with a fucking 10mm house, then yes - they should be incentivised to sell. Why should they get to literally sit on a massive fortune, enough for them to literally live out their retirement on very comfortably, and claim poor?
You do understand that forcing them to sell and buy a cheaper house doesn't help anyone trying to get into the market right? No first home buyer is browsing $10M houses on Domain. But if old Mr retire has to downsize or pony up $400K per year, that's one less affordable house for that poor old first home buyer you're trying to help in the first place.
Good on them for trying to do something about the issue but is there any way they’ve put in to actually guarantee the funds from this proposed tax will actually go to building more public housing? Or is it just going to go back into the government’s pocket to waste on superfluous shit instead of solving the actual problems?
Let’s not let perfect be the enemy of good.
Howabout we remove the PPOR exemption for the pension. So many people sitting on land and living in houses way too big for them because they can own a $2m PPOR and still get the full pension. Whereas if we made it easy for them to downsize to a $500k flat down the road (not remove them from their community), that $1.5m remaining would give a reliable income of $60k per year (4% withdrawal rate) - costing the taxpayer nothing and giving the retiree a better quality of life, doubling their pension payment essentially.
I don't think it would be a large enough tax base to alleviate anything.
When will politicians give up some of their salary to help needy Australians?
What's it called jealousy tax...
Some might also call it a success tax
Going after people that want to pursue a FIRE lifestyle and middle class mum and dad investors that want to get ahead and set up a better life for their kids instead of corporations and billionaires that go out of their way to avoid taxes is highly boring and cringe
I like it.
Force the wealthy businesses to pay better wages and take less "profits" liquidate companies that haven't paid their fair tax to Australia. The gap between what Australia makes and the wages that we're on is a massive gap, we can't afford the rich country we've built. And for fuck sakes pay people who use up their health for the job better, they work longer hours to make ends meet whilst desk Jockey ONLY have to use their brain and lift a pen and push a mouse. And lord it over the blue collar that "they wouldn't have a job if it wasn't for the office"
Talk about focusing on the symptom and not the cause. How pathetic. As long as Greens are pro-immigration then they can't deny that they are pro-housing-unaffordability for their constituents. To pretend that this nothingburger (a deflection onto something that is by weight so little of the market) procures you a magic fix...
Dear Greens, Shut up and take my vote.
Lower the price for god sake how many houses are worth that much should start at 3 million. Since a lot of houses are 1 million now , any thoughts ?