Property investor capital gains tax mooted to rise in 2017 Federal Budget

Property investor capital gains tax mooted to rise in 2017 Federal Budget
Property investor capital gains tax mooted to rise in 2017 Federal Budget

The Turnbull government is planning to cut capital gains tax concessions for property investors, according to a report in The Australian Financial Review.

It says the policy backflip will be unveiled in the May budget.

"It is understood the policy being worked on within government would be confined to property investment, and not apply to all investments such as shares, as Labor's plan would," reporter Phillip Coorey wrote.

The options being worked on include following Labor in halving the 50 percent discount on capital gains tax to 25 percent, or reducing it by another amount. The other is adopting a phased model in which the discount would increase the longer the property was held. A property would have to be held for several years before the investor was eligible for the full 50 percent discount.

The suggestion has been wrapped up as seize the initiative on housing affordability but will provide revenue to help replace soon-to-be dumped budget cuts.

"Neither would the Coalition policy target negative gearing, as Labor is doing."

But Malcolm Turnbull this morning said the Government did not support the Labor Party’s plans to increase capital gains tax or negative gearing.

“We do not support the Labor Party’s plans to increase capital gains tax or indeed their plans to outlaw negative gearing.

"Our policy is… focused on encouraging investment and employment and the economic growth and opportunity that Australians need”.

“The only party that is an advocate for higher taxes is the Labor Party… We are a party of lower taxes, supporting investment, supporting employment, and bringing the Budget back into balance”.

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

Tags: 
Capital Gains Taxation

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