Australian Federal Election - 2022

[Eager]

I make that point above after hearing right wing opinions says the Teals are left of Labor.

We must have watched the same program.

The only hope for the Libs now, especially if herr Dutton takes over, is to amalgamate with PUP and ON and whip people into a frenzy. Plenty of dumbass voters will get sucked in, I'm sure.

 

[Knobby22]

Ralph Babet, United Australia Party might be taking the third Coalition senate seat in Victoria.
Greg Mirabella, husband of Sophie is the one who loses out. He was trying to get in for the first time though he hot in a year earlier as the previous senator retired. Clive will be happy if he gets it.
i still reckon it may go Liberal.

https://www.abc.net.au/news/elections/federal/2022/results/senate
Click on Victoria

 

[mullokintyre]

Ralph Babet, United Australia Party might be taking the third Coalition senate seat in Victoria.
Greg Mirabella, husband of Sophie is the one who loses out. He was trying to get in for the first time though he hot in a year earlier as the previous senator retired. Clive will be happy if he gets it.
i still reckon it may go Liberal.

https://www.abc.net.au/news/elections/federal/2022/results/senate
Click on Victoria

Well, the Mirrabella family are all off the gravy train now.
Ralph Babet of the Australia United Party has taken the sixth senate seat.
It highlights the absurdity of our preferential voting farce that Babet got a gong despite the UAP recording 0.28 of a quota on first preferences. So a tad over 70% of his quota came from the preference flow of people who may have not even considered their vote would end up with UAP.
Mick

 

[Knobby22]

Well, the Mirrabella family are all off the gravy train now.
Ralph Babet of the Australia United Party has taken the sixth senate seat.
It highlights the absurdity of our preferential voting farce that Babet got a gong despite the UAP recording 0.28 of a quota on first preferences. So a tad over 70% of his quota came from the preference flow of people who may have not even considered their vote would end up with UAP.
Mick

Mirabella only got 0.26 once you take away the first 2.

Disappointing. Now we have a crank in parliament.
He said the voting is rigged. Maybe he should resign as he must have helped rig it.

 

[Value Collector]

And franking credits are effectively available to any and everyone with a share trading account. They are reasonably fair.

Negative gearing credits are really only available to people who already own a home (suppose they could be renters themselves) and have enough money to own a second investment home - which is generally the wealthy earners.

Negative gearing is available to anyone that borrows to invest, you can definitely have a negatively geared share portfolio.

If you borrow $100K to buy shares and that earn $2000 in dividend income, but your interest on the loan is $3000, you are negatively geared.

So that $1000 loss you made ($2k income minus $3k interest expense), can be written of against your other income.

So if you earn $70,000 at your job, the $1000 you lost in interest expense will be deducted from your $70,000 making your taxable income only $69,000

————————

Negative gearing isn’t just a property strategy, it’s a debt strategy in general, any leveraged investment that produces less income than its interest expense is negative gearing, it just so happens that in Australia because people live to take out big loans on property in the early years most of the time the expenses out weigh the rental income.

 

[PZ99]

Bugger negative gearing. Get rid of it.

 

[Value Collector]

Bugger negative gearing. Get rid of it.

What would you use to replace it?

I mean what method would you use to allow businesses or investments that generate losses in the early years to claim that loss?

—————-
One option would be to capitalise losses from an investment from which you deduct future profits, but if that investment never ends up making a profit you will end up with people that have no way to claim those losses.

 

[PZ99]

Just remove it from the housing market and stop these taxpayer funded price distortions.

 

[InsvestoBoy]

What would you use to replace it?

I mean what method would you use to allow businesses or investments that generate losses in the early years to claim that loss?

My proposal is that for secondary investments you should only be able to claim losses against gains from the investment you made, not other income. Which is I think what you're saying below, but I qualify it further to apply specifically to secondary investments.

Only primary investment should receive the status quo treatment, to discourage borrowing for secondary investment (which is in aggregate inert/harmful wealth transfer) and encourage primary (real) investment.

One option would be to capitalise losses from an investment from which you deduct future profits, but if that investment never ends up making a profit you will end up with people that have no way to claim those losses.

Great. Perhaps it will encourage a bit more diligence, caution and risk management from all parties involved in heavily geared secondary markets like the Australian property market.

 

[Value Collector]

My proposal is that for secondary investments you should only be able to claim losses against gains from the investment you made, not other income. Which is I think what you're saying below, but I qualify it further to apply specifically to secondary investments.

Only primary investment should receive the status quo treatment, to discourage borrowing for secondary investment (which is in aggregate inert/harmful wealth transfer) and encourage primary (real) investment.



Great. Perhaps it will encourage a bit more diligence, caution and risk management from all parties involved in heavily geared secondary markets like the Australian property market.

I am not sure what you mean by primary and secondary investments.

But, let’s say I some one has a some CBA, BHP, FMG and WOW shares and they are all paying a decent dividend.

But then that person decides to buy into a 5th company let’s say CSL using some debt. Are you saying if that leveraged CSL investment generates a negative cashflow that the investor shouldn’t be able to deduct this loss from the dividends of the other companies or other investment income?

I mean we can claim other losses from other profits all the time, I if he sold the CSL shares for a loss no one would have a problem with him deducting his CSL loss from his BHP capital gain.

It makes perfect sense to me that an investor should only pay tax on his total net profit or loss over all, and any losses should be deducted from any profits to arrive at a net taxable income.

I mean how far does it go, if I lose money on CSL do I have to actually go and try to make that capital gain back on CSL to be able to claim the loss?

 

[Value Collector]

Just remove it from the housing market and stop these taxpayer funded price distortions.

Why single out the housing market though? At the end of the day investors putting money into the housing market does increase supply of rentals, which currently there is a shortage of.

If they want to sign up to lose money by renting out properties for less than their cost of capital and hence subsidising renters let them, if they are claiming 30cents on the $1 they lost it’s a good deal for the government and the rental market.

 

[SirRumpole]

What would you use to replace it?

I mean what method would you use to allow businesses or investments that generate losses in the early years to claim that loss?

—————-
One option would be to capitalise losses from an investment from which you deduct future profits, but if that investment never ends up making a profit you will end up with people that have no way to claim those losses.

There is no reason for negative gearing on residential property to exist at all.

As mentioned, it distorts the market.

Housing is for people to live in, not to make a profit from.

Home ownership is about the only way for most taxpayers to have a retirement buffer in their old age. NG tilts the balance in favour of landlords and away from owner occupation and contributes to the high cost of housing we have today.

 

[Value Collector]

There is no reason for negative gearing on residential property to exist at all.

As mentioned, it distorts the market.

Housing is for people to live in, not to make a profit from.

Home ownership is about the only way for most taxpayers to have a retirement buffer in their old age. NG tilts the balance in favour of landlords and away from owner occupation and contributes to the high cost of housing we have today.

In australia we rely on the private sector to provide housing to the rental market, with that supply provided by the private sector there would be less supply to meet the demand and rents would be higher.

All negative gearing does is allow people that use debt to claim any cashflow losses against income from other sources.

With out negative gearing, you would restrict property investment to richer folks, and limit small investors opportunity to participate.

 

[SirRumpole]

In australia we rely on the private sector to provide housing to the rental market, with that supply provided by the private sector there would be less supply to meet the demand and rents would be higher.

All negative gearing does is allow people that use debt to claim any cashflow losses against income from other sources.

With out negative gearing, you would restrict property investment to richer folks, and limit small investors opportunity to participate.

Small investors can invest in the share market, that's what its for and it doesn't deprive others of the opportunity to own their own homes

 

[PZ99]

Why single out the housing market though? At the end of the day investors putting money into the housing market does increase supply of rentals, which currently there is a shortage of.

If they want to sign up to lose money by renting out properties for less than their cost of capital and hence subsidising renters let them, if they are claiming 30cents on the $1 they lost it’s a good deal for the government and the rental market.

Investing in the housing market only increases supply of rentals if the houses are actually rented out. Many are not. They are simply kept vacant which merely aggravates the shortage.

It's not a good deal for the taxpayer to sponsor someone else's losses encouraged by a tax system that favours investment with dubious security.

If you want to help renters, dump the NG and use that revenue for income tax relief.

 

[Value Collector]

Investing in the housing market only increases supply of rentals if the houses are actually rented out. Many are not. They are simply kept vacant which merely aggravates the shortage.

It's not a good deal for the taxpayer to sponsor someone else's losses encouraged by a tax system that favours investment with dubious security.

If you want to help renters, dump the NG and use that revenue for income tax relief.

I doubt a material portion of homes are purposefully kept vacant. But, If It's kept vacant it doesn't qualify for the Negative gearing deductions, Interest on vacant properties that don't produce income is capitalised and deducted from any future capital gain.

 

[Value Collector]

Small investors can invest in the share market, that's what its for and it doesn't deprive others of the opportunity to own their own homes

who are we to tell people which sectors they can invest in, thats for the market to decide.

 

[SirRumpole]

who are we to tell people which sectors they can invest in, thats for the market to decide.

The taxpayers forgo revenue for negative gearing so they should have a say in where that revenue goes.

 

[PZ99]

I doubt a material portion of homes are purposefully kept vacant. But, If It's kept vacant it doesn't qualify for the Negative gearing deductions, Interest on vacant properties that don't produce income is capitalised and deducted from any future capital gain.

You might like to research that one mate. Last time I checked there were a million homes sitting empty.

Why? Because the current distortions driven by NG are causing landlords to enjoy the higher / faster cap gains as opposed to servicing debt by renting out the properties.

 

[PZ99]

The taxpayers forgo revenue for negative gearing so they should have a say in where that revenue goes.

Agreed. The current tax system is a burden on renters who are forced to work longer/harder to pay such exorbitant rents and this is the bracket that needs tax relief from winding back pointless welfare such as NG given that it's their high taxes that are paying for it.

Of course, none of this will happen... The current PM and opposition leader have something like 10 properties each. Which is kinda strange considering the PM is banning ministers from owning shares

Ministers forced to sell shares under new code of conduct

The new code also bans the use of blind trusts by government ministers. Under a new code of conduct introduced by Prime Minister Anthony Albanese, federal government ministers will be forced to dives

www.investordaily.com.au