WEALTHY AUSTRALIANS THE HEAVIEST USERS OF NEGATIVE GEARING

TAX OFFICE DATA reveals … with Neg Gearing … the highest average losses are occurring in POSTCODES with the BIGGEST INCOMES and that those on higher incomes tend to be the KEENEST USERS  of NEGATIVE GEARING …  

AND not Teachers, Ambos … those on less than $80K p.a. …

SHARE!

Wealthy Australians the heaviest users of negative gearing

 

By Leith van Onselen

The Grattan Institute’s Danielle Wood says she is not surprised by tax office data regarding negative gearing losses.

The data reveals that the highest average losses are occurring in postcodes with the highest incomes, with Wood noting that those on higher incomes tend to be the keenest users of negative gearing. From The Australian:

Property investors in some of Australia’s wealthiest suburbs are racking up negative gearing losses that average more than $20,000 a year, new taxation ­office figures show.

A breakdown of rental income deductions by postcode, released by Treasury under freedom of ­information laws, reveals the largest average negative gearing losses are in the nation’s highest income postcodes…

“The geographic spread of the losses doesn’t surprise me,” Ms Wood said… “We’ve previously found that 50 per cent of the tax benefits from negative gearing go to the top 10 per cent of income earners — assessed before rental loss ­deductions”…

Suburbs highlighted by ATO data include Sydney’s Darling Point, part of the Wentworth electorate formerly held by Malcolm Turnbull, and Melbourne’s Higgins, which was until recently held by former financial services minister Kelly O’Dwyer.

So here’s yet more evidence debunking the Coalition’s and property lobby’s incessant lie that negative gearing is used primarily by ‘ordinary mum and dad’ middle-income earners.

 

Fact check: Do two-thirds of negative gearers have a taxable income under $80,000?

josh frydenberg's claim is misleading

 

Indeed, ABC Fact Check last year also showed that negative gearing is used primarily by higher income earners:

The graph below shows that people who earn a total income before negative gearing of above $80,000 receive 61.8 per cent of the net rental losses, despite representing only 47.7 per cent of negative gearers.

It also shows that the 52.3 per cent of negative gearers below $80,000 only account for 25.9 per cent of the benefit of reduced tax. The 47.7 per cent above $80,000 account for 74.1 per cent.

Once again, as the thresholds increase, the disparities between the share of negative gearers and the net rental loss and tax benefit increase.

The 9.5 per cent of negative gearers above $180,000 account for 19.1 per cent of the net rental losses, and 26.2 per cent of the reduction in tax paid.

And above $245,000, 4.5 per cent of negative gearers account for 12.4 per cent of the net rental losses, and 15.8 per cent of the reduction in tax paid…

Experts and academic research have broken down this topic in different ways, showing that negative gearing disproportionately benefits higher-income earners…

Curtin University academics Helen Hodgson, Alan Duncan and Rachel Ong ViforJ, along with Griffith University’s John Minas, calculated earlier this year that the mean or average tax saving due to negative gearing for the highest-earning 25 per cent of negatively geared investors is a figure more than four times that of the lowest-earning 50 per cent.

Another negative gearing lie blown-out of the water. As was the case with the lie claiming abolishing negative gearing would force-up rents.

Fact check: Did abolishing negative gearing push up rents?

 

Treasurer Joe Hockey says scrapping negative gearing pushed up rents in the 1980s.

 

SHARE!

unconventionaleconomist@hotmail.com

 

SOURCE:  https://www.macrobusiness.com.au/2019/04/wealthy-heaviest-users-negative-gearing/

CAAN FACEBOOK:

https://www.facebook.com/Community-Action-Alliance-for-NSW-744190798994541/?ref=aymt_homepage_panel

WEBSITE:

https://caanhousinginequalitywithaussieslockedout.wordpress.com/