Daily Bulletin


The Conversation

  • Written by Sunanda Creagh, Editor, The Conversation

In relation to this FactCheck, The Conversation asked Labor for sources to support Opposition Leader Bill Shorten’s assertion that negative gearing and capital gains tax concessions cost the federal government more than child care or higher education.

The spokesperson told The Conversation that:

The Grattan Institute has estimated the cost of the Capital Gains Tax and negative gearing at $11.7 billion per year, [writing that]: “These two measures (negative gearing and the capital gains tax discount) in combination allow investors to reduce and defer personal income tax, at an annual cost of $11.7 billion to the public purse.”

The Treasury’s tax expenditure statement (TES) lists the cost of the capital gains tax discount as $6.15b for 2015-16.

The TES does not list the cost of negative gearing, but using Grattan’s total figure and subtracting the value of the capital gains tax discount, this shows that the cost of negative gearing is around $5.5 billion.

The Grattan Institute’s proposed policy (which differs from Labor’s proposal) raises less than the total cost to the budget of negative gearing, as it does not completely abolish negative gearing but restricts it.

This cost exceeds the cost of child care assistance or university education as per the budget papers.

As indicated in the policy paper on the Australian Labor website, the independent Parliamentary Budget Office has costed Labor’s proposal to restrict negative gearing to new property and to halve the capital gains tax discount to raise $565 million over the forward estimates and $32.1 billion over the decade to 2026-27.

This does not equal the full cost of negative gearing and the capital gains tax discount, as Labor is restricting negative gearing to new housing and halving the capital gains tax discount, not abolishing these subsidies altogether, but directing them towards more productive uses than speculating on existing property. The ALP policy is also fully grandfathered, as Labor does not support retrospective tax changes.

In the forward years the cost of child care and university costs will change, but so will the cost of the capital gains tax discount and negative gearing.

Authors: Sunanda Creagh, Editor, The Conversation

Read more http://theconversation.com/response-from-labor-spokesperson-61201

Writers Wanted

The Best Android tools and Utility Apps

arrow_forward

How to Find the Best SEO Services Company That Offers Guaranteed Results

arrow_forward

The Conversation
INTERWEBS DIGITAL AGENCY

Politics

Prime Minister Interview with Ben Fordham, 2GB

BEN FORDHAM: Scott Morrison, good morning to you.    PRIME MINISTER: Good morning, Ben. How are you?    FORDHAM: Good. How many days have you got to go?   PRIME MINISTER: I've got another we...

Scott Morrison - avatar Scott Morrison

Prime Minister Interview with Kieran Gilbert, Sky News

KIERAN GILBERT: Kieran Gilbert here with you and the Prime Minister joins me. Prime Minister, thanks so much for your time.  PRIME MINISTER: G'day Kieran.  GILBERT: An assumption a vaccine is ...

Daily Bulletin - avatar Daily Bulletin

Did BLM Really Change the US Police Work?

The Black Lives Matter (BLM) movement has proven that the power of the state rests in the hands of the people it governs. Following the death of 46-year-old black American George Floyd in a case of ...

a Guest Writer - avatar a Guest Writer

Business News

How to Find the Best SEO Services Company That Offers Guaranteed Results

As a business owner, you have to be strategic about how you’ll be able to reach your target market. That is why entrepreneurs implement various marketing tactics to reach their goals. With today...

News Co - avatar News Co

Top Reasons Why Your Business Needs SEO

SEO is crucial for the ranking of a website. You may think that SEO offers greater searchability while it can do more than this. The most cost-effective tool for the survival of smalls businesse...

News Co - avatar News Co

Nisbets’ Collab with The Lobby is Showing the Sexy Side of Hospitality Supply

Hospitality supply services might not immediately make you think ‘sexy’. But when a barkeep in a moodily lit bar holds up the perfectly formed juniper gin balloon or catches the light in the edg...

The Atticism - avatar The Atticism



News Co Media Group

Content & Technology Connecting Global Audiences

More Information - Less Opinion