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Negative gearing debate unlikely to help housing affordability

Negative gearing debate unlikely to help housing affordability

A national industry association has come out swinging against government negative gearing debates.

“Housing affordability will not be addressed by political point scoring around negative gearing or capital gains tax,” said HIA’s chief executive, industry policy and media, Graham Wolfe.

“It’s a distracting and lazy debate and one where all three levels of government point a finger at each other, when it’s a fact that around 40 per cent of the cost of a new home is taxation.”

Negative gearing was a key point in the federal election with debates raging between it and land supply as being the biggest factor behind the current house price issues.

The Australian Labor Party have called for negative gearing to be done away with to ease the burden on first home buyers and begin lowing housing costs.

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Last week the Liberal government was seen to be divided over the issue, in a speech to the Committee for Economic Development, NSW planning minister Rob Stokes expressed concerns that supply was not the only factor in the housing affordability crisis.

Mr Wolfe echoes this statement and said that if the “enormous taxation burden” on the cost of new homes was not going to be addressed then the flood of new houses onto the market would do nothing to help housing affordability.

“It’s the taxes and levies that are charged on every new home that overwhelmingly defeat all attempts to reduce housing costs,” said Mr Wolfe.

“Housing, a basic requirement that all Australians should be able to access, is taxed more heavily than other parts of the economy.”

Until the tax burdens are eased the price of housing is not going to become more achievable, according to Mr Wolfe.

Read the full article at REB online

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