Negative gearing changes ruled out by Turnbull
Prime Minister Malcolm Turnbull has ruled out changes to negative gearing in the May budget.
Labor have planned to “restrict negative gearing to new houses and grandfather existing investments from next year”, as dictated in an article on www.abc.net.au should they win the next election.
“Mr Turnbull … confirmed there would be no changes to any aspect of the policy, after Treasurer Scott Morrison at one point earlier this year hinted there could be changes.” Negative gearing will stay the same in the 2015-2016 budget.
“The changes that Labor is proposing to negative gearing will devalue every home in Australia, that is what they are designed to do”, Mr Turnbull said.
“What they will also do is jack up rents. Labor has got a trifecta; they want to discourage investment, jack up rents and reduce home values.”
“A tax on mum-and-dad investors is not a good plan for families, it’s not a plan for growth and it’s not a plan for jobs and that’s why we will not have a bar of it,” he said.
“The thing to remember about the value of your home is that when you have confidence in the value of your home, you have a confidence in this economy.
Labor’s housing tax puts at risk the confidence of Australians in the value of their own home, which drives their confidence in this economy and that’s why it’s just a really, really bad idea.”
See what Turnball has to say about Negative gearing & capital gains – What it means for property investors
The Housing Industry Association (HIA) has welcomed this announcement by the Prime Minister that negative gearing arrangements will remain unchanged.
“Negative gearing promotes private investment in the residential rental market, stimulates economic activity and relieves pressure off social housing and ultimately the public purse,” said HIA Chief Executive Industry Policy and Media, Graham Wolfe.
A media release on behalf of the HIA has stipulated that “research conducted by Independent Economics on behalf of the Housing Industry Association (HIA) confirmed that restricting access to negative gearing for residential property would reduce investment in housing and put upward pressure on rents.
Research confirms that negative gearing also provides a positive force for the Australian economy and Australian living standards”
“Today’s announcement compliments the Government’s commitment earlier in the year to retain capital gains tax arrangements, facilitating ongoing access to residential property as a worthwhile retirement investment strategy across all income earners,” Mr Wolfe added.