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Perth’s most prestigious pocket overwhelmingly supports winding back property tax breaks despite being among their biggest beneficiaries, “surprising” survey results have revealed.
Metres from Cottesloe beach, billionaire mining magnate Andrew Forrest is renovating a 130-year-old heritage home; next door is Peppermint Grove, with the second-highest income of any suburb in Australia; and across the bay is Dalkeith, where Gina Rinehart has a riverside mansion.
All three suburbs headline Perth’s “Golden Triangle”, and all three fall within the Curtin electorate.
Curtin MP Kate Chaney said the vast majority of her wealthy constituents wanted investor incentives for residential property scaled back.
Chaney and community-based think tank Amplify conducted a survey that found more than 90 per cent of those who lived there wanted tighter limits on negative gearing, and 80 per cent wanted the capital gains tax discount changed.
“I was surprised by the results in my electorate because my electorate does disproportionately benefit from capital gains tax and negative gearing, but there is this sense that people want to live in a fair country,” Chaney said.
“I knock on so many doors and speak to people who say, ‘I’m fine, I’ve got my house, I’ve got an investment property, but I’m really worried about younger people in the country that we’re creating’.
“A lot of people across Australia are really hoping that this government will grow some guts and do something brave to level the playing field.”
Approximately two-thirds of the 242 respondents owned a residential investment property. While acknowledging the sample size was small, Chaney said it indicated desire for change.
On Tuesday, Labor gave another sign it will change the concession at the May budget, after two government senators – including Western Australia’s Ellie Whiteaker – endorsed a Senate committee’s finding that the tax concessions skewed the housing market towards investors rather than young people.
Nine News and WAtoday understands Treasury has asked Chaney’s office for the results of the survey – they would be used to bolster Treasurer Jim Chalmers’ argument should reforms be introduced.
Analysis from the Parliamentary Budget Office showed negative gearing and the capital gains discount would cost taxpayers $13.6 billion this financial year. Fifty-five per cent of the benefits go to the richest 10 per cent of households.
Further figures revealed the tax break on capital gains would cost the budget almost $250 billion over the next decade if the Albanese government does not water it down.
Greens Senator Nick McKin often laments that Australia’s richest one per cent receives 60 per cent of the benefits from the capital gains tax discount.
“Right now is a historic opportunity for Australia to right the wrong of the capital gains tax discount,” McKim told the recent senate committee.
“It’s a major contributor to the housing affordability crisis that we have.
“If you got to work as a carpenter or a bartender or a nurse, you’re paying much more tax than someone who makes the same amount sitting on the couch flipping houses.
“The capital gains tax discount is turbo-charging wealth inequality in Australia.”
Chaney said potential tax changes would need to be part of a broader reform, given the country’s current tax system is ‘not suitable for the next few decades.’
“We’ve got an ageing population, we rely too much on personal income tax, and we are going to need to shift that balance so that we can support older generations and that involves taxing capital more than taxing income,” Chaney said.
“There’s a whole lot of things we could do there in order to reduce those personal income rates and part of that is property taxes, also taxing gas better and also looking at GST and how we can structure that.”
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