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Liberal Party all at sea on negative gearing



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CHRIS BOWEN MP SHADOW TREASURER MEMBER FOR MCMAHON

LIBERAL PARTY ALL AT SEA ON NEGATIVE GEARING

The loudest criticism the Liberal Party, including Malcolm Turnbull and Scott Morrison, have hoisted on Labor’s reforms to negative gearing and capital gains tax discount is that they only raises $560 million over the first four years.

In keeping with his track record at being the most inconsistent Treasurer in living memory, it wasn’t long ago that Scott Morrison was arguing for measures which have little immediate impact on the budget, but build as savings over time: exactly what Labor’s well calibrated policy does, with a positive budget impact of $32 billion over the next decade.

But it gets worse for the Treasurer: Labor has purposefully designed our policy to improve the Budget in a responsible way, with all existing investments grandfathered, and therefore no disadvantage to people who have made investments in good faith.

As the Treasurer refuses to rule out making his own changes to negative gearing and complains that Labor’s policy does not raise enough in the early years, he has a simple question to answer: will changes he makes be grandfathered or will he be hitting investors with retrospective tax changes?

In an extraordinary move, Liberal Senator Scott Ryan this morning effectively called for changes to negative gearing and CGT to be made retrospective:

“I think we need to be careful to not say everyone who has got into the system now, „you can keep your gains, but we are going to legislate to stop other people getting into it from a particular date‟. I think there is a fairness question about that.”

TRANSCRIPT, ABC LOCAL RADIO NEWS, 9AM BULLETIN

The criticism implies the Government is looking at how to change the property tax settings for current property investments.

This position has already been attacked by the Liberal deputy leader, Julie Bishop, who has said:

„Now that's an anathema to most Australians, retrospective tax.‟

TRANSCRIPT, INSIDERS, 23 MAY 2010

Julie Bishop is right to point out that changing the rules on those who have already made investments in good faith is not fair.

The Treasurer, Scott Morrison, has maintained radio silence on Labor’s plan to wind back the capital gains tax from 50 to 25 per cent.

Labor’s policy is well calibrated, gradual, and importantly, fully grandfathers and protects those investment properties entered into prior to 1 July 2017.

If you currently own a residential property investment, you won’t be effected by Labor’s proposed changes to negative gearing or the reduction of the capital gains tax discount, which apply from 1 July 2017.

Malcolm Turnbull and Scott Morrison are all talk when it comes to tax reform. Having wasted months on six months on an ill-fated attempt to increase the GST, the Treasurer has been reduced to pathetic attempt to criticise Labor’s changes to negative gearing whilst keeping the door open to his own changes.

MONDAY, 15 FEBRUARY 2016

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