Two years ago today, Bill Shorten launched Federal Labor’s housing affordability policies – reforms to negative gearing and the capital gains tax discount.
Talking about or reforming negative gearing had been one of the great sacred cows in Australian politics over the last three decades.
Shorten Labor has made it a mission to develop and champion fair Budget reform through a serious of difficult decisions and structural reform that sees Budget savings build over time, as opposed to the Turnbull Government’s $65 billion big business tax cut that ends up costing $15bn a year by the end of the medium-term.
The reforms of negative gearing and the capital gains tax discount were the beginning of an ambitious tax reform and base broadening agenda, that Labor has subsequently added reforms to the taxation of superannuation, trusts and taxation affairs.
Federal Labor has been prepared to take sensible political risks to outline tax reforms that not just provide a return to the Budget and pay down debt, but provide positive social impacts.
Labor’s reforms to negative gearing and the capital gains tax discount not only return $39 billion to the Budget bottomline, but more importantly, put first home buyers on a level playing field with property investors.
These tax concessions overwhelmingly benefit high income earners, so keeping them in place sees lower and middle income earners pick-up the tab in the form of higher taxes.
Labor has confirmed that it will take these pro-first home buyer reforms to the next election alongside a second tranche of housing affordability reforms including: facilitating a uniform vacant property tax, limiting direct borrowing by SMSFS, establishing a bond aggregator, boosting homeless support and re-establishing the National Housing Supply Council and a Federal Minister for Housing.
Only Federal Labor has a plan to tackle housing affordability and to put first home buyers on a level playing field with investors.