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Property Council rejects tax increase proposal

By Matt Hurlston

Reducing the capital gains tax (CGT) discount and increasing other types of property taxes might not sound like a fair deal, but one group believes it’s essential to the health of the economy. The Grattan Institute’s latest report, titled Hot property: negative gearing and capital gains tax reform, makes a case for an overhaul of the current system – a move that hasn’t been welcomed by one industry group.

The Property Council of Australia said it was “happy to debunk” claims made in the report, which could have significant implications for anyone buying real estate in Bentleigh East.

According to the Institute, the CGT discount should be lowered from 50 per cent to 25 per cent, while investors should be no longer able to use negative gearing to deduct losses incurred from their investments. CEO of the group and study co-author John Daley believes there would be far-reaching advantages to altering the current system.

“We estimate property prices would be up to two per cent lower under these reforms than they would be otherwise,” he commented.

Mr Daley also stressed that land supplies could increase, while interest rates may become more favourable. However, the Property Council is not convinced.

Property Council chief executive Ken Morrison claimed that making these changes would ultimately lead to “less investment in housing, higher rents and less jobs in the property industry”. This isn’t sustainable, especially given what an important role real estate plays in the wider economy.

Make your investment in Bentleigh East real estate

These recommendations aren’t likely to become policy anytime soon – if at all. However, it will pay to get ahead of the game and invest in real estate in Bentleigh East as soon as you’re able.

Property values are rising all the time, so why not get in touch with Matt Hurlston to secure your next investment property at today’s prices?

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