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Australia’s leading union organization has presented a compelling case to a federal Senate inquiry, asserting that tax incentives for landlords are detrimental to the average worker.
ACTU President Michele O’Neil addressed the Senate, highlighting how the current tax break system favors professional landlords, making homeownership increasingly inaccessible for working Australians.
O’Neil emphasized, “Our tax structure should prioritize labor over wealth accumulation.”
She pointed out that numerous workers can no longer afford to reside near their workplaces, forcing them into lengthy and expensive commutes, which reduces their family time.
The union’s proposal to reduce the capital gains tax (CGT) discount aims to level the playing field for first-time home buyers, making it easier for them to compete with seasoned landlords and step onto the property ladder.
“We need these changes now because a growing number of workers may never be able to save enough for a deposit while accelerating rents and house prices outpace the money they can save each week.”
The ACTU wants the CGT discount scaled back from 50 per cent to 25 per cent, saying the discount “has become a tax minimisation scheme allowing the very rich to pay lower rates of tax by investing in the property market”.
Its submission to the inquiry also calls for restrictions on negative gearing tax breaks.
It wants both concessions limited to only one investment property.
A report claims 24,000 millionaires accounted for almost half the beneficiaries of the controversial tax break.
Oxfam Australia found the thousands of people who made over $1 million in 2022-23 gained an average of $271,000 from the 50 per cent capital gains tax discount on profits from the sale of assets, likely property.
Greens Senator Nick McKim, who is leading the Senate inquiry into the discount, has described the policy as the “most unfair tax rort in the country”.
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