Dear Lucifrase,

More than happy to see adjustments to CGT.

However you seem to be confusing investors and speculators. The former go and find an investment that can stand on its own just as two of my relatives did recently when they brought new homes in an area where the rent will surpass the expenses right from the go without any negative gearing subsidies. The latter dive into a loss making venture in the hope that the increase in price will make it worth it in the long run.

The first pay tax on the income earned, the second require subsidies of foregone taxes for decades to make their venture viable.

It is the speculators that have driven house prices to hardly affordable levels. The sooner they are eased out of the housing sector the better.

Unless of course you are going to make the case that the property sector is not overinflated, then I would invite you to reflect on the tale of the dry dromeidary.
http://www.poetrylibrary.edu.au/poets/paterson-a-b-banjo/shouting-for-a-camel-0026018

If you want limits on NG, argue for that, not its abolition, and apply it to all asset classes.

What comes with that is limits to mobility of average punters who want to back themselves in through leverage.

We live in a capitalist society that has provided a far better life for more of its members than any hessian-clad, sad-sack socialist nation. I'm for erring on the side of encouraging risk-taking, growing the pie, and taxing and distributing wealth. CGT is a part of this, as are death duties. NG does not rate in comparison to these for attention, IMO

Dear Luciferase,

You wrote;

“If you want limits on NG, argue for that, not its abolition, and apply it to all asset classes.”

Isn't that exactly what I have done? I have said I want it reserved for new dwellings as there are recognisable social benefits realised through supporting building sector jobs and increases in housing stock.

You then opined;

“We live in a capitalist society that has provided a far better life for more of its members than any hessian-clad, sad-sack socialist nation.”

Permit me to reflect on some of your wording. I'm not sure that subsidising loss making investments really aligns with any true notion of a 'capitalist society'. The capitalist uses money to produce commodities which earns them more dollars. Any true capitalist would decry the distortion of a market through government interference. I hope you accept at least that Australia's housing market is suffering just such a distortion.

As someone who has owned and operated small businesses and thoroughly enjoyed the opportunities a capitalist system can bring I recognise the role of government in a such a society as controlling the excesses that inevitably follow unfettered capitalism.

Those controls can appear to some as socialism. The Nordic countries regularly figure in the top rankings in any happiness survey despite being heavily taxed and heavy spenders on social services. Social democracies with market economies supporting welfare states seem to provide the greatest value to the population as a whole.

Finally you said;

“I'm for erring on the side of encouraging risk-taking, growing the pie, and taxing and distributing wealth. CGT is a part of this, as are death duties. NG does not rate in comparison to these for attention, IMO”

More than happy to acknowledge our respective opinions have us, if not on the same page, then at least in the same ballpark, if you would excuse the mixed metaphor.

" I'm not sure that subsidising loss making investments really aligns with any true notion of a 'capitalist society'."

There is no more intent to lose money in investing for capital growth than in carrying on any other profitable activity. NG simply time-shifts losses and the CGT treatment is an incentive.

You do, presumably, support loss write-downs in business, if not against income from paid employment

Luciferase,

"There is no more intent to lose money in investing for capital growth than in carrying on any other profitable activity...."

Property investment advisers would beg to differ...

"How is losing money considered a wise investment strategy?

Buying an investment property is an important financial decision that is part of an overall strategy designed to meet both your shortand long-term goals. This strategy should be based on your current financial position and personal circumstances.

With this in mind, the main reason investors use negative gearing as a strategy is to reduce taxable income, while building wealth through potential capital growth. Put simply, if you make a loss on an investment property, you can claim a tax reduction on your income (known as a tax offset). You can then use the tax offset to lower your tax bracket, meaning you pay less tax.

Negative gearing is a particularly popular strategy with high-income earners who are looking for ways to build wealth and have the tax department help fund the investment...."

http://www.whichproperty.com.au/News-Articles/Negative_gearing_explained

Thanks for that handy, informative quotation from unbiased investment experts.

If you're flogging Gold Coast units, of course you'll spruik NG to punters as the path to riches. Well, it's just not, as many have found, but don't let me stop you believing.

If Labor wins, the massive reduction in investment in rental housing will raise rents and gov't will need to build more public housing, but with what? OTB makes fair points.

Also, it is still not clear to me whether Labor is initially proposing to remove NG from all asset classes other than used housing. It would only be a matter of time before it did, I suppose.

I'd be happy with a limit on NG that continues to give M&D's some investment leverage. I also believe that death duties/inheritance taxes need looking at so CGT liability is not carried to the grave.

I'm not mad keen on any major party but, on balance over a range of issues, LNP has my vote this time. Labor can't lie straight in bed over LNP's welfare and super changes, pretending everybody wins under its governance when we all know it will carry through the necessary changes if elected. Also, Labor is too tinged Green on a range of issues for my vote this time.