Treasury Secretary Calls for Government to Prioritize Increasing Housing Supplies
Australian Treasury Secretary Steven Kennedy has rejected the Greens’ proposal to change negative gearing and capital gains tax discounts as a solution to the housing crisis in the country.
Kennedy emphasized the importance of boosting housing supplies instead of implementing new taxation measures to address the current housing crisis in Australia.
The Greens have been advocating for the abolition of negative gearing and capital gains tax discounts, arguing that these measures would benefit renters and first-home buyers.
Negative gearing occurs when the costs of owning an asset exceed the income generated from rent, resulting in a loss that investors hope to offset when selling the property. The capital gains tax discount allows individuals to pay tax on only 50 percent of the capital gain when selling an asset, under certain conditions.
Kennedy explained that these tax policies have been in place for some time and cautioned against rushing into any changes without careful consideration. He stated that the primary issue affecting the housing market is the shortage of available dwellings, rather than potential tax policy adjustments.
He encouraged the government to focus on increasing the supply of public affordable housing and housing in general, as a way to address the current challenges in the housing market.
