Welcome Guest [Log In] [Register]


Reply
Get Up! End Negative Gearing & Property Buyer / First Home Buyer FHB Strike; 40,000 First Home Buyers On Strike - David Collyer
Topic Started: 16 Mar 2011, 08:59 AM (25,079 Views)
Mr Wu
Member Avatar


pauk
26 Mar 2011, 09:56 AM
A home should never have been used as a speculative asset and therefore it should be treated differently under the law.

Wu say it is and law say so, Pauk cry all he like and it no change law

Quote:
 
NG will go when the boomers no longer need it and need those taxpayers dollars directed to health and pension.

Wu say pauk display limit of brain
Pauk sillily think only boomer have ng property but this small brain think
Wu say many gen x and even y have Ng property as well
They be the ones who become politician, maker of law
Wu ask does pauk think they will no want ng advantage on own ip's just because pauk say?
Profile "REPLY WITH QUOTE" Go to top
 
Deleted User
Deleted User

Mr Wu
26 Mar 2011, 10:26 AM
Wu say it is and law say so, Pauk cry all he like and it no change law



Wu say pauk display limit of brain
Pauk sillily think only boomer have ng property but this small brain think
Wu say many gen x and even y have Ng property as well
They be the ones who become politician, maker of law
Wu ask does pauk think they will no want ng advantage on own ip's just because pauk say?
Numbers and data....4.5 million boomers....the biggest voting block and that will continue, regardless if the youth need NG or not.
The boomers are self centered and do not care as a cohort for the young, only themselves, the most selfish generation in history.

NG will go and all the votes of the youth will mean nothing....

Boomers got free higher education, do the youth of today?
Boomers got affordable housing, do the youth of today?

Even if Gen x and y become the pollys they will not have the voting block necessary to cater for themselves.
Less kids now as a percentage of the population than a decade ago, and declining......
"REPLY WITH QUOTE" Go to top
 
funny_man
Default APF Avatar

pauk
26 Mar 2011, 10:35 AM

The boomers are self centered and do not care as a cohort for the young, only themselves, the most selfish generation in history.

absolutely.
The luckiest (and as you said, the most selfish) generation ever on this planet. Unlikely to see these sorts of conditions again for a few decades or centuries.
Luck played more a part than any skill they had or supposed "hard work (which the young'ns these days would never know about :dry: )" they put in

(Im not talking just about Australia, but most the western world).

Profile "REPLY WITH QUOTE" Go to top
 
BubbleBoy
Member Avatar


Strindberg
25 Mar 2011, 07:28 PM

The whole manner of the presentation of the ban-negative gearing case is dishonest. It is presented as if there is a special law and privilege given to holders of income earning assets. There is no such law. They are treated exactly like everyone else (apart from those deemed to be running a business as a hobby). It is the ban-negative gearing lobby who are asking for a new law to enforce discrimination. As I have written before, negative gearing (holding a loss making investment) cannot be banned. But the ban lobby don't actually want negative gearing banned – they want the introduction of a discriminatory tax law to enforce quarantining for which the natural tax law of Australia does not provide. Non-quarantining is not a "concession". It is the basic taxation law of Australia.
Using an "tax economic gain" criterion it is indeed a concession.

Take a 500K property. If you make a rental loss of 3% and a capital gain of 3%. Economically you are no better off. Yet thanks to Negative Gearing you have benefited.

You made a cashflow loss of $15K. You can claim - assuming you are on the 38.5% tax rate - $5,775 in deductions.

Yet for the offsetting capital gain, the tax liability is deferred till you realise the asset AND subject to a 50% discount.

Sidenote: if one believes that 50% concessions on CG's are justifiable due to inflation, they should be consistent and only allow an interest deduction for the real interest rate (ie to the extent interest paid is greater than inflation).
Edited by BubbleBoy, 26 Mar 2011, 01:30 PM.
My name is based on a Seinfeld character, not on a belief of a housing bubble.
Profile "REPLY WITH QUOTE" Go to top
 
Deleted User
Deleted User

NG is now a dead issue as it assumes capital growth and only the delusions and in denial would expect house price gains in the short to medium term....

NG is no use at all in a falling market and note that the market is in decline now.....
"REPLY WITH QUOTE" Go to top
 
Strindberg
Member Avatar


BubbleBoy
26 Mar 2011, 01:28 PM
Using an "tax economic gain" criterion it is indeed a concession.

Take a 500K property. If you make a rental loss of 3% and a capital gain of 3%. Economically you are no better off. Yet thanks to Negative Gearing you have benefited.

You made a cashflow loss of $15K. You can claim - assuming you are on the 38.5% tax rate - $5,775 in deductions.

Yet for the offsetting capital gain, the tax liability is deferred till you realise the asset AND subject to a 50% discount.

Sidenote: if one believes that 50% concessions on CG's are justifiable due to inflation, they should be consistent and only allow an interest deduction for the real interest rate (ie to the extent interest paid is greater than inflation).
The concept of "tax economic gain" applies to the person. We don't tax individual sources of income separately. We tax the person on the basis of his "economic gain" resulting from his collective income and expenses. The whole concept of income tax is applied to the person, not the individual components of a person's earnings or expenses. If you have two jobs the incomes are added and the deductions are added. There is no quarantining - nor should there be. The logical conclusion of quarantining and the taxation of earnings sources, rather than persons, is separate tax free allowances and tax scales for each quarantined item and universal rates of tax on each earnings source independently of the person.
A concessionary benefit logically requires some form of affirmative action in favour of the benefit. No such affirmative action, and therefore no concession, exists. The introduction of quarantining would be an affirmative action in favour of a penalty.
Edited by Strindberg, 26 Mar 2011, 01:58 PM.
Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
Profile "REPLY WITH QUOTE" Go to top
 
Deleted User
Deleted User

Strindberg
26 Mar 2011, 01:57 PM
The concept of "tax economic gain" applies to the person. We don't tax individual sources of income separately. We tax the person on the basis of his "economic gain" resulting from his collective income and expenses. The whole concept of income tax is applied to the person, not the individual components of a person's earnings or expenses. If you have two jobs the incomes are added and the deductions are added. There is no quarantining - nor should there be. The logical conclusion of quarantining and the taxation of earnings sources, rather than persons, is separate tax free allowances and tax scales for each quarantined item and universal rates of tax on each earnings source independently of the person.
A concessionary benefit logically requires some form of affirmative action in favour of the benefit. No such affirmative action, and therefore no concession, exists. The introduction of quarantining would be an affirmative action in favour of a penalty.
Well it seems clear that you have never owned a business that made a loss.....no writing this off against other personal income, it carries forward......seems you are not really a tax expert at all....
"REPLY WITH QUOTE" Go to top
 
BubbleBoy
Member Avatar


Strindberg
26 Mar 2011, 01:57 PM
The concept of "tax economic gain" applies to the person. We don't tax individual sources of income separately. We tax the person on his collective income and expenses. The whole concept of income tax is applied to the person, not the individual components of a person's earnings or expenses. If you have two jobs the incomes are added and the deductions are added. There is no quarantining - nor should there be. The logical conclusion of quarantining and the taxation of earnings sources, rather than persons, is separate tax free allowances and tax scales for each quarantined item and universal rates of tax on each earnings source independently of the person.
A concessionary benefit logically requires some form of affirmative action in favour of the benefit. No such affirmative action, and therefore no concession, exists. The introduction of quarantining would be an affirmative action in favour of a penalty.
As my previous example showed, there is clearly a concession when the NG outcome is benchmarked against the criterion of taxing economic gains equally.

If capital gains are going to be taxed on a concessional (50% discount) and deferred (ie realisations) basis there is no reason why interest expenses should not be subject to concessional (ie only allow a deduction for the real interest rate) and deferred (ie to the extend can't offset against rent, defer the time you can benefit from it). Mind you, if you could only deduct the real interest rate you won't usually have a rental loss from a tax point of view to defer.

This would come closer to the tax being based on economic gain.

You talk as if the rule of "earnings sources must be treated indifferently" is written in stone. In fact, there are already provisions in the tax legislation that do treat different earning sources differently (such as the non-commercial loss provisions).
My name is based on a Seinfeld character, not on a belief of a housing bubble.
Profile "REPLY WITH QUOTE" Go to top
 
BubbleBoy
Member Avatar


Strindberg
26 Mar 2011, 01:57 PM

A concessionary benefit logically requires some form of affirmative action in favour of the benefit. No such affirmative action, and therefore no concession, exists. The introduction of quarantining would be an affirmative action in favour of a penalty.
By the way, I disagree with this statement. Concessional tax treatments do not necessarily require an affirmative action.

I'll give you a simple example.

Till the introduction of the CGT provisions in 1985, most CG's were tax free. This was clear concessional tax treatment. But it wasn't due to any affirmative action on anyone's part. It was due to the fact that courts historically made an arbitrary income v capital distinction based on hundreds of years of trust law, and that the parliament for whatever reason had yet to fulfill that hole.
My name is based on a Seinfeld character, not on a belief of a housing bubble.
Profile "REPLY WITH QUOTE" Go to top
 
Strindberg
Member Avatar


BubbleBoy
26 Mar 2011, 02:05 PM
As my previous example showed, there is clearly a concession when the NG outcome is benchmarked against the criterion of taxing economic gains equally.

If capital gains are going to be taxed on a concessional (50% discount) and deferred (ie realisations) basis there is no reason why interest expenses should not be subject to concessional (ie only allow a deduction for the real interest rate) and deferred (ie to the extend can't offset against rent, defer the time you can benefit from it). Mind you, if you could only deduct the real interest rate you won't usually have a rental loss from a tax point of view to defer.

This would come closer to the tax being based on economic gain.

You talk as if the rule of "earnings sources must be treated indifferently" is written in stone. In fact, there are already provisions in the tax legislation that do treat different earning sources differently (such as the non-commercial loss provisions).
Capital gains are NOT taxed on a concessional basis. The 50% application replaced the previous index linked policy. It is not clear whether the new system collects more or less than the previous system. Any after cost capital gains less than twice CPI are now taxed more heavily than previously. The previous system was never viewed as a concession - why should this one be viewed as a concession? People now have to pay capital gains tax where none was due previously. It appears that the change was made for administrative simplicity reasons rather than to gift tax relief.

My main point in these posts is not to address the desirability or otherwise of quarantining. The issue I am addressing is the false presentation that people are being given a perk. It is rather the other way around, income earning asset holders who borrow are treated like everyone else under the tax system. In practical reality the campaign proponents are not asking for the removal of a perk - none exists. They are asking for the introduction of a penalty - ie the introduction of quarantining. I already recognised the non-commercial loss provisions issue - that was done to address the hobby abuse and is recognised as a penalty. Similar application of quarantining to this issue should also be recognised as the introduction of a penalty rather than getting rid of a perk.
Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
Profile "REPLY WITH QUOTE" Go to top
 
1 user reading this topic (1 Guest and 0 Anonymous)
Go to Next Page
« Previous Topic · Australian Property Forum · Next Topic »
Reply



Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.

Forum Rules: The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.

Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.

Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.

This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.

For more information go to Limitations on Exclusive Rights: Fair Use

Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ

Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy