6 years ago
HIA MODELLING DOES NOT MODEL LABOR’S HOUSING POLICIES
CHRIS BOWEN MP
Modelling produced in December last year and released today by the Housing Industry Association is not modelling of Labor’s housing affordability policies.
The HIA has a long standing position of opposing Labor’s housing affordability policies.
The modelling commissioned by the HIA is not modelling of Labor’s policy because it does not model the impacts of grandfathering and it does not model the proposed changes to negative gearing – key features of Labor’s housing policies.
The modelling concludes that halving the CGT discount across all asset classes will see house prices increase. It also concludes that some tenants “will switch and become owner occupiers” (page 25), in other words, increasing home ownership.
The HIA modelling comes two years too late for Kelly O’Dwyer who was quick out of the blocks to argue Labor’s housing affordability policies would see house prices increase – the exact opposite of what Malcolm Turnbull have been arguing for the past two years.
The HIA modelling is at odds with the Commonwealth Treasury who produced analysis (which Scott Morrison attempted to hide) of Labor’s policies that concluded:
“…increases in taxation on rental property could have a relatively modest downward impact on property prices. …
“Owner occupiers who are unaffected by the changes are likely to limit the extent to which there is an impact on prices.”
The HIA is also at odds with an ever increasing list of organisations and individuals arguing for reforming negative gearing and capital gains concessions, including:
- The IMF
- The OECD
- The Government’s own Financial System Inquiry
- Grattan Institute
- ACOSS
- The Committee for Economic Development in Australia (CEDA)
- Australian Institute of Company Directors
- Saul Eslake
- Glenn Stevens
- Jeff Kennett
- Joe Hockey
Even the Property Council of Australia has a policy position in favour of cutting the capital gains tax discount from 50 to 40 per cent.
Winding back tax expenditures like the CGT tax discount is a more equitable and efficient way of raising revenue than the Turnbull Government’s income tax increases to people with incomes as low as $21,000.
Labor’s housing affordability policies have been specifically designed to stimulate new housing supply by continuing to allow negative gearing arrangements for investments in new housing stock, while protecting existing investments.