Could it be that the average deduction figure per investor does not include rent claimed as income? There's no way known the net concession is 36B, it's more like 3.
I remember posting data here once showing that CGT paid by individual resi investors was something like 4 times the total NG concession each year.
Australia's total tax intake is pooled together and used to fund essential services used by everyone, including renters.
Property investors contribute more to that pool of funds than renters, yet renters use the funded services just as must as PIs do.
Because we pay more tax, you get to pay less tax, yet use the same services. Therefore we subsidise you.
a) you dont subisidize me at all buddy...
b) get off your high horse.. you pay more tax because you rent out a house... i pay more taxes as i run businesses... i do not say i am subsizdizing my employees though - i give them a wage, they give me work ..
Should you not have renters, you would not be able to pay said tax in the first place as you wouldnt have been able to purchase property...
Shads Doh, yep high income earners pay more tax than the poor...what is now about that?
Nothing new at all, and I don't mind subsidising renters because it means I'm making more profit, so it's a win-win for everyone, landlords, renters and the government alike.
I only brought this up because right at the beginning of the discussion Piccolo claimed taxpayers (by which he meant renters) were subsiding property investors.
I simply pointed out that it is the other way around. Highly taxed homeowners, including investors, subsidise essential services for low taxed renters, as a result of the $40 billion net tax revenue we generate for the government every year.
How did you get to the conclusion that PI pay at least half of the $40B/year net in taxes. Wasn't the amount $36B. Per Shadow's breakdown, $9B of that was rates. Rates is a direct fee for service that the property owner benefits from with rubbish collection and road maintenance in the area. It doesn't go into consolidated revenue. So lets exclude that shall we.
Why do you think it doesn't go into consolidated revenue? Rates are exactly that - the local council's consolidated revenue. There is even a breakdown in my rates which shows an amount which goes to waste removal and the rest (larger portion) goes into .... welll rates or tax. And it doesn't benefit the property owner ... it benefits the local community. The tenant gets the use of the library, parks and even the garbage removal - not the property owner. You trying to discount it because the council them spends it in libraries, parks, roads, etc is like saying income tax should be discounted from the tax the population pays because it is used for defense force, national highways, welfare payments, and other things the population uses.
I simply pointed out that it is the other way around. Highly taxed homeowners, including investors, subsidise essential services for low taxed renters, as a result of the $40 billion net tax revenue we generate for the government every year.
again... this is bullshit...
For all you know, one of your renters could be founder of a multi-million dollar company and paying more taxes in a year than you do in your lifetime, contributing more to the essential services than you ever will ...
That said, it is true that many renters are on lower income / wealth scale, but allowing them to rent your property is not a subsidy on their taxes ... The services they enjoy are not because they rent your property but because you use property as a means to generate revenue and are taxed on that.
Those claiming tax concessions for losses ARE claiming a subsidy from other tax payers as they have made a loss they dont want to pocket on their own .... thats all there is to it.
anyway.. ill leave it there... it would seem that head of yours is too firmly lodged in your arsehole to pursue further.
Why do you think it doesn't go into consolidated revenue? Rates are exactly that - the local council's consolidated revenue. There is even a breakdown in my rates which shows an amount which goes to waste removal and the rest (larger portion) goes into .... welll rates or tax. And it doesn't benefit the property owner ... it benefits the local community. The tenant gets the use of the library, parks and even the garbage removal - not the property owner. You trying to discount it because the council them spends it in libraries, parks, roads, etc is like saying income tax should be discounted from the tax the population pays because it is used for defense force, national highways, welfare payments, and other things the population uses.
Wrong. I've audited councils and the vast majority of the money they receive is used on rubbish collection and road maintenance i.e. it doesn't get passed on to state or federal level (though a small amount can occasionally). A lot of councils are running at a loss. These are services provided to the house which contribute to the amount of rent you as a property investor can collect from the house. In addition you claim it as a deduction where OO can't.
And it doesn't benefit the property owner ... it benefits the local community. The tenant gets the use of the library, parks and even the garbage removal - not the property owner.
It benefits the property owner. If your rubbish weren't collected, the OO or renter would have to use their own time and money to remove the waste. This in turn would reduce the amount of disposable income that renters have and market rents would adjust downwards. The maintenance of roads in the area also benefits the property investor by making the area your property is in more appealing. Just imagine an area without a council and roads were all run down, the houses in that area would in turn rent for less. Do you ever see nearby parks advertised in rentals i.e. close to parks? I've seen a lot of it, don't you think that adds to the value of your rental. The council rates are effectively a fee for service to maintain your area, and doesn't generally end up in either state or federal consolidated revenue.
Defence force, national highways, welfare payments etc come out of either state or federal consolidated revenue, i.e. your rates don't pay for them. Your rates only pay for your house's rubbish collection and maintenance of local roads etc which you or your tenant benefit (and hence you in the form of increased rents) from.
In addition PI get a discount on the benefit they receive from rates because it is tax deductible. OO generally pay the full amount with no tax deduction.
For all you know, one of your renters could be founder of a multi-million dollar company and paying more taxes in a year than you do in your lifetime, contributing more to the essential services than you ever will
Sure, one of them could be. So could one of their landlords, or any one of their homeowner neighbours.
But the renter running the multi-million dollar company isn't paying any housing tax. The homeowner running the multi-million company is.
Besides, the vast majority of multi-million company owners would also own their own home. It's far more likely that a millionaire CEO is going to be a homeowner and/or property investor rather than a renter!
Just accept the fact that subsidise you. You should feel good about it, rather than getting angry. Does it not feel good to be paying less tax than me?
Defence force, national highways, welfare payments etc come out of either state or federal consolidated revenue, i.e. your rates don't pay for them. Your rates only pay for your house's rubbish collection and maintenance of local roads etc which you or your tenant benefit (and hence you in the form of increased rents) from.
All "taxes" pay for government provided services. Rates (council), stamp dutues, GST (state government), income tax, CGT etc (commonwealth). I don't understand why you are trying to differentiate local government from the other levels? Everything we pay any of them is a "tax". The only differences are the things that the different levels of government are responsible for.
For Aussie property bears, "denial", is not just a long river in North Africa.....
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