The Australian Council of Trade Unions has welcomed the Labor Party’s new fairer tax policy, announced this weekend. The Labor party has announced they would make changes to negative gearing and capital gains if they win this year’s election.
Labor has committed it will maintain the current negative gearing arrangements for existing investors with new investors, from 2017, being able to access negative gearing for newly constructed houses.
Coupled with changes to capital gains, this announcement is a win for investors, people looking to buy their first home, and jobs. ACTU President Ged Kearney has said “”This is great news for investors as they will be able to continue to invest in property with a negative gearing benefit but will be contributing towards the development of desperately needed new housing and we will reduce the barriers for young people looking to get into the housing market.”
Labor has stressed that people who currently have negative gearing will be able to continue to do so and from 2017. Labor and the ACTU hope this policy will encourage future investors to increase Australia’s housing stock thus helping to alleviate the current housing crisis, and help first home buyers break into the housing market.
“At the moment many Australians, especially young people, have been locked out of the property market as wealthy investors drive up housing costs to unattainable levels.” said Ms Kearney.
The ACTU also highlighted that it also means a boost to the federal budget that can be put toward vitally important public services, like health and education.
“Importantly, the changes will also mean a massive revenue boost, estimated to add an extra $4.5 billion to the GDP which means healthcare, education and vital pubic services can be properly funded, reducing people’s everyday costs.”