Call to outline “ridiculous” negative gearing plan

by Rebecca Pike31 Jan 2019

A property investment group has demanded Federal Labor “come clean” on plans for negative gearing.

The Property Investors Council of Australia (PICA) said recent media reports indicate the opposition may be “flip-flopping” on its controversial policy.

Labor’s proposal has been to limit negative gearing to new housing, saying the tax subsidies are unaffordable.

But according to some reports this month, Labor had suggested rethinking the proposals. PICA chairman Ben Kingsley said it was “no doubt due to falling property prices”.

Kingsley is calling on the party to come clean on when it intends to implement the policy, calling it “ridiculous” and “absurd”.

He said, “Restricting negative gearing to new property was always a ridiculous so-called ‘solution’ to Sydney’s strong price growth, which has now well and truly dissipated because it was merely a sign of the peak of a market cycle.

“If the policy was absurd back then, it’s even more so now, with the national economy flat-lining due to a number of poor indicators including significant property price falls in our two biggest cities.”

Kingsley said a timeline was needed because there was too much at stake to keep the public in the dark about the changes.

“The majority of every Australian’s wealth is in their property so having the threat of their home’s value falling even further is no doubt part of the reason why our economy is in the doldrums,” he said.

“It’s clear that people are fearful about these dangerous changes, both property owners and investors alike, so if Federal Labor is thinking about introducing these measures as early as July this year buyers need to have enough time to organise their finances and come to the market in the next few months to meet this deadline.

“With Labor tipped to win the Federal Election, the uncertainty is affecting the Australian property market and the broader economy, which is why Bill Shorten should announce the party’s intentions today. There is no reason not to tell us their plans as the policy was formulated years ago.”

COMMENTS

  • by SEQ Broker 31/01/2019 9:48:19 AM

    Heres the Rub.
    Surely Bill Shorten realises that all his union buddies and their mates are blue collar workers. These blue collar workers only have one option for wealth creation. Their property. How many families have been working hard and paying extra towards their mortgages to create equity (Equity which may as well read "options in life") are now having their equity drained thanks to the Shorten inspired Royal Commission.

    If Shorten carries the removal of negative gearing - in any form - into the election. All Morrison has to do is paint the ugly picture of what happens later in life, with a mortgage larger than the value of the house for blue collar families. Point at Bill and remind the public that he is taking your equity, your options and your future wealth. We wont. We only have one policy, we wont do that!

  • by Broker 31/01/2019 1:02:40 PM

    People forget very quickly just how financially incompetent the recent Labour Governments have been , this one will be no different and will more that likely be booted out after one term , likely to be where a recession occurs, that sees them double the current debt levels well inside their term and around and around we go . Oh the choices we have!