Teachers at the forefront of Australia's negative gearers: ATO data

Teachers at the forefront of Australia's negative gearers: ATO data
Teachers at the forefront of Australia's negative gearers: ATO data

New data confirms two-thirds of investors who negatively geared property were on taxable incomes of less than $80,000 a year.

The latest tax office data suggests Labor’s policy to amend the widely used property purchasing practice would mostly hit more lower-income earners with only one investment property, according to Treasury analysis of the 2015-16 tax records published in The Australian.

The statistics also included figures on the number and occupations of people affected by Labor’s $20bn plan to scrap negative gearing after the next election on any new purchases of established properties, showing 62 per cent were on taxable incomes of under $80,000 a year.

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Teachers at the forefront of Australia's negative gearers: ATO data

The opposition has argued that the move would target the wealthy with multiple investment properties.

However, the data shows that more than 70 per cent of negative gearers did so with only one property.

The Tax Stats are an overview of 16 million income tax returns for 13.5 million individuals, 940,000 companies, as well as superannuation funds, partnerships and trusts lodged for 2016. 

They further reveal that teachers rank behind only company chief executives and senior managers as the largest group of property investors to negatively gear, with 58,000 claiming rental losses on their tax returns.

While 72,000 investors were listed as company executives, 99,000 people claiming rental losses on their tax returns were either teachers, nurses or midwives.

Labor has long rejected claims that lower income earners would be hit by scrapping negative gearing.

It maintains 70 per cent of the value of benefits went to the wealthiest 10 per cent citing analysis by the Grattan Institute.

In the ATO data, out of the professions, surgeons had the highest average taxable income of $393,467, followed by anaesthetists on $359,056, internal medicine specialists on $291,140, financial dealers on $263,309 and psychiatrists on $211,024.

Other medical practitioners came in sixth on $199,590, followed by judicial and other legal professionals on $198,219, mining engineers on $166,557, chief executives and managing directors on $158,249 and engineering managers on $148,852.

According to the ATO, out of nearly 1200 occupations recorded, there were fewer than 100 where women had a higher average taxable income than men — they included receptionists, schoolteachers and beauticians.

"Reports in The Australian on ATO data showing that almost two thirds of investors are on an average income of less than $80,000... affirmed independent research undertaken for HIA by The CIE," said HIA’s principal economist, Tim Reardon.

Changes to negative gearing would adversely impact on the housing market, exacerbating the current undersupply of housing and further reduce the efficiency of the housing market.

“This reduction in house supply would also adversely impact on wage growth and GDP.

“Driving investors out of the market will force up the price of renting as nearly 25 per cent ofrental stock is provided by private investors," he noted.

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Negative gearing Ato

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