“You’ve been invited to Canberra this week to attend a Senate inquiry,” announced my PA, Kathryn.
“Let me think about that,” I replied.
Pause.
“Actually … I’d rather buy funeral insurance.”
This inquiry would be like a tacky theatre restaurant, except the waiters are on $180,000 and the ending has already been rehearsed.
The topic?
Reducing the Capital Gains Tax discount for property investors.
So here’s what I’d say if I went, which is precisely why I won’t:
“I strongly encourage you to pass laws that will make the value of my house go down.”
Can you imagine the headlines?
“BAREFOOT INVESTOR PLEADS: ‘MAKE ME POOR!'”
And I mean it.
Right now I get a 50 percent discount on the tax I pay when I sell an investment property. Meanwhile, Kathryn pays full freight on every dollar she earns answering my emails.
She’s 32. Still living with her mum. Jokes about putting a tiny house on my back paddock.
She’s not joking.
Two-thirds of voters own homes. Politicians know the maths. So they won’t say this out loud: the tax system props up the housing market. It rewards people who already got in.
Cut the discount and politicians get to look brave. They get to say they’ve “taken on investors.” And Canberra pockets more tax.
Beautiful.
But don’t let them keep it. Instead, use it to lower income taxes. Stop taxing effort harder than a property gain.
Cut the discount.
My property drops in value? I’ll cope.
Kathryn gets a shot at a roof over her head, and keeps more of her pay?
Worth it.
Tread Your Own Path!