The independent economic think tank e61 has estimated that only 53% of housing investors will pay more tax under the Federal Government’s housing tax reforms and 43% will pay less.<\/p>\n
The reforms passed in June replace the 50% capital gains tax (CGT) discount with an inflation deduction, introduce a minimum 30% capital gains tax rate, and delay when investors can deduct negative gearing losses until sale.<\/p>\n
E61’s analysis of 920,000 housing investments between 2008 and 2025 estimates that capital gains tax changes would have benefited the majority of investors, lowering CGT for 54% of investments and increasing it for 42%.<\/p>\n
On the negative gearing side of the ledger, e61 says the changes pull in the other direction, lowering rental income tax for 28% of investors and increasing it for 49%.<\/p>\n
e61 Institute Senior Research Economist Elyse Dwyer says while only a narrow majority of investors would pay more tax overall, the research concludes that government tax revenue would rise noticeably, driven by the highest-performing investments.<\/p>\n
“The new way of taxing CGT is likely to raise more revenue for the budget bottom line, mainly coming from high-return investments,” Ms Dwyer said<\/p>\n
“It ties the tax bill more closely to the actual size of an investor’s gain, so small and negative returns are taxed more lightly, and large real gains are taxed more heavily.<\/p>\n
“That also brings down the overall riskiness of housing as an investment, because large positive and large negative returns get pulled closer to the middle.”<\/p>\n
The e61 analysis found that investors with high leverage, or with little other taxable income such as retirees, are the most likely to pay more tax under the changes.<\/p>\n
While e61 is a self-described non-partisan tank driven by ex-Treasury and RBA staffers, as well as and university researchers, it should be noted that Labor MP and Assistant Minister for Science, Technology and the Digital Economy Andrew Charlton is a co-founder.<\/p>\n
Dr Charlton resigned his directorship at e61 on entering parliament.<\/p>\n","protected":false},"excerpt":{"rendered":"The independent economic think tank e61 has estimated that only 53% of housing investors will pay more tax…\n","protected":false},"author":2,"featured_media":902068,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[2001,64,63,166,2009,99,2005,160,2010,2006,2002,1491],"class_list":["post-902067","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-asx","tag-au","tag-australia","tag-australian-dollar","tag-bitcoin","tag-business","tag-dow-jones","tag-live-blog","tag-live-update","tag-nyse","tag-share-market","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/902067","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=902067"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/902067\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/902068"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=902067"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=902067"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=902067"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}