Prevent tax back for individuals owning multiple properties
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In a land where many people can't afford one house, or have to pay off a home loan for twenty years, well off individuals are buying multiple. Investment properties that limit the houses the rest of us can buy and making them more expensive for future buyers.
I want to see a taxation system that relies less on the people earning their wages, by having one focused more on investors. Instead of having more tax for workers, I'd like to see more tax on investors, especially the ones who are making buying houses impossible or far too expensive for most people on a working wage.
Preventing any tax back for owners of multiple domestic properties will give potential house investors more to consider. It should reduce the amount of investors and increase tax on people who already own multiple homes, which probably isn't any poor person needing a tax break. Ideally, this will also lower house prices.
Someone earning $340 a week, less than 18k a year, won't pay tax, so won't get tax back. Someone earning 180k (who has very likely worked a lot harder, but unlikely ten times harder or as much as the prior has worked) will have paid over $54,000 in tax, can hire an accountant, and with enough deductions could get over twenty thousand dollars in tax back. I can't find a maximum you can claim, thankfully there has to be a legitimate reason to get any tax back. Such as paying too much tax, the cost of managing tax affairs, personal super contributions, gifts, donations and investment income deductions. Have you made an investment but lost money? You can try to get that money back from Australian tax payers. Relative is sick? Donate to a charity that helps instead of giving tax that helps all Australian's. I'm not saying they don't deserve the tax back, nor would I like less donated, but it is a choice that individual made and I don't think we all should pay for it. They certainly don't need the money more than someone struggling to pay for rent and food who wouldn't get tax back for donating to charities if they didn't earn enough to pay it.
As for house prices, most Australian's wanting a house will get a loan, but over twenty years of compound interest could mean that people are paying over a million dollars for a 600k loan. Eventually they may sell it, perhaps for 800k, maybe for 1.2 million, either way the banks are earning more than the original buyer in this circumstance. We need something to burst the bubble, house prices are going up faster than people can afford, in part because of housing investments. But the thing is, the people who can afford more than one house don't need as much money as the people who can't afford any houses. Investment houses are a way of making banks and already somewhat rich individuals even richer, by screwing over other Australians.
The disadvantage: If Australian house prices are lowered, it could mean more overseas buyers. To counter this, I'd also like to propose that only Australian citizens living in Australia are able to purchase domestic property in Australia.
Investors aren't necessarily an enemy to poor people, they're not all extremely rich people, example; the ones who need loans to afford the second house. I expect investors are middle income or higher earners who want more more money, weather to simply earn more in the short term by rent, and/or as an investment for retirement. I simply wish for these people to find a way that isn't hurting others, the poor and the future generations.
A possible accidental benefit is that if house prices lower, the cost per month of loans. If that wasn't good enough, in turn that could make owners lower the cost of rent, allowing people to move houses cheaper.
So, to the Australian government when a fair one is voted in, I call on them to make laws that specify certain circumstances which block individuals from receiving tax back. With one of those circumstances being the owner of more than one domestic property. It is the government's job to make Australia fair and to make sure people are paying their tax. To make sure people aren't avoiding it. But, I would still like them to put more thought into it, to make sure that people who've paid too much tax get it back, and that it doesn't stop people who are legitimately trying to sell their second house from getting tax back in other ways. And I don't want business, even small, one property businesses getting caught in this.
It's not like anyone with two houses can say they're not rich with the current house prices: $500,000 is equivalent to over 13 years of minimum wage. If they sold one, they still wouldn't have to pay rent if living in the other house. They can't say it isn't fair, they have more than their fair share already.
If I'm making some sense, feel free to share this without supporting it yourself. Add your opinion, or improvements I can make to this proposition.
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