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Bruce

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 #16 
negative gearing certainly does not benefit the taxpayer; it benefits banks to some degree for as it forces up the price of property the banks lend out larger sums of money, so they get more profit.  the prospective tenant loses out because as the price of property goes up the rent to be paid has to go up proportionally.  the only one who benefits is the person who has the wherewithal to buy the property using negative gearing.  it would be nice to think that the tradies profit from it due to an increase in building activity to keep them in employment, but I have yet to see a valid argument that this is the case - and I did say VALID argument.
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Greg

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 #17 
Do you think that negative gearing benefits the taxpayer , banker or prospective tenants most?
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Greg

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Posts: 155
 #18 
What do you think about the government allowing people to lose money deliberately in order to get a tax deduction for buying a property on which they will not pay any or full capital gains tax. Govt should simply impose full CGT on any property on which expenses like interest have been allowed as a deduction. Banks are the real beneficiaries. Young home seekers the losers. But I think this is not really a topic of interest so we will close the  forum late February to tackle othr matters
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Greg

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 #19 
Support for negative gearing is based around it being a very effective tax rort promoted by most accounting and law firms and off course by banks and real estate agents. It keeps young Australians enslaved to landlords and helps high earners save tax. It iwll be removed when voters ask for it to be removed in large enough numbers or different MPs get elected.
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Bruce

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Posts: 37
 #20 
I do not agree with people being able to touch their superannuation savings outside of extreme circumstances of financial problems.  I DO agree with getting rid of negative gearing on property.  we need to find out which MPs have negative gearing because I feel that the reason there is resistance in parliament to get rid of it is because there are too many MPs with a vested interest.  getting rid of negative gearing will cause less money being directed into houses so that demand is less so that the price comes down.  That means of course more people of lower incomes will be able to access property.  Allowing people to use their super to fund a property will have the reverse effect on house prices and thus act counter to the intent.  Do you remember when financial institutions only allowed one salary to be assessed for an ability to pay a mortgage?  there was an argument then that allowing both spouse salaries to be used for the assessment would allow young couples to get into a house more quickly.  the effect of the change to allow two salaries was that there was then more money available to buy a home so prices went up.  Young people now HAVE to have 2 salaries to get into the housing market.  This is the exact opposite of what the ruling was intended to achieve.
Just remember the old saying "Be careful what you ask for".
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Greg

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Posts: 155
 #21 
Home buyers should get into this because homes have become instruments of profit instead of place to live. Insatead of forcing young people to rent for life we could ensure that they can and do afford a home. We need a government finance providing department  instead of all our superannuation pouring overseas to enrich other nations. Everyone should be entitled to use their superannuatio  saving sand contribution to buy a home with the government maintaining a caveat over it so that on sale before retirement age, funds must be  re-invested into another similarly restricted home.
A home is the very best form of security. Let's use super to enrich its contributor insdtead of the wealth industry and foreign countries.
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Greg

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Posts: 155
 #22 
Negative gearing is a politically patronised form of tax evasion for those comparatively well off, politely called avoidance.
It involves a moderately wealthy person buying a property with the deliberate intention of renting it out at a loss in order to claim that loss as a tax deduction to reduce the tax paid on their otherwise high income. It is a scam.
You might ask why would someone deliberately lose $1 to get a tax deduction of 46 cents. Many people prefer to waste money than pay it to the tax office.
But there is another benefit in turning housing into a tax scheme. When the person eventually sells the home, the capital gains tax they pay on the increase in value will be far less than the tax they saved by their loss-making scheme. The capital gains tax will usually be discounted by 50%.
So a person gets a tax deduction for all expenses of a loss-making investment at say 46% and is later taxed on the capital gain at 23%. The higher your tax rate the more appealing it is. Pretty good really. Poor old salary earners subsidise it all.
Meanwhile it prices young Australians out of the housing market or puts them in extra debt.
Most older Australians are not about to sell  their homes nor need great wealth so they would not mind prices coming back a bit to help their kids or grandchildren buy a home to avoid a lifetime of unproductive renting.
Politicians are just rewarding their supporters and donors, the big property developers, agents and banks. Those are the ones who really gain by selling the properties and lending the money for super-profits.
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