The Property Investors Council of Australia (PICA) has welcomed renewed public debate around Capital Gains Tax (CGT) concessions but warns that simplistic or punitive changes risk undermining housing supply, rental stability, and long-term affordability outcomes.

PICA’s position is clear: Australia does not need speculative behaviour in the residential property market — it needs a sustainable, well-supplied, and healthy housing system.

“Since late 2019, PICA has actively advocated for a structured, evidence-based approach to Capital Gains Tax reform that discourages short-term speculation, while preserving incentives for long-term investment,” said Ben Kingsley, PICA’s chair

A Graduated CGT Model That Targets Speculation — Not Supply

Rather than reducing or removing CGT concessions outright, PICA has proposed a graduated Capital Gains Tax discount framework that directly targets speculative activity, while recognising inflation impacts and the critical role of long-term investors in providing rental accommodation.

Under PICA’s proposal:

• Year 0 to 1: No Capital Gains Tax discount
• Year 1 to 2: 10% CGT discount
• Year 2 to 3: 20% CGT discount
• Year 3 to 4: 30% CGT discount
• Year 4 to 5: 40% CGT discount
• After 5 years: 50% CGT discount (capped)

This model deliberately removes incentives for short-term trading and flipping, while rewarding investors who commit capital for the long term and contribute to housing supply.

“If the government is genuine in improving housing inequality, whilst ensuring rents don’t balloon out of control, our model ensure more rental supply and less ‘trading’ of property for short term profits”, Kingsley said.

Protecting Renters Means Supporting Long-Term Investors

PICA cautions that sweeping reductions or removal of CGT concessions could lead to unintended consequences, including:

• Reduced investor participation
• Lower rental supply
• Increased pressure on rents
• Greater volatility in housing markets

“Long-term investors are not speculators — they are the backbone of Australia’s private rental system. Policies that fail to recognise this reality risk hurting renters more than helping them.” Kingsley noted.

A Call for Evidence-Based Policy Making

PICA is urging policymakers to move beyond headline-driven reform and engage with industry bodies on solutions that balance affordability, stability, and supply. “If this is a genuine attempt to reform the market and not a smoke screen for revenue raising, then we support reform that is targeted, measured, and fair,” said Kingsley.

“Our proposal achieves this by aligning tax settings with desired behaviour — discouraging speculation, while encouraging patient capital and sustainable housing outcomes.”

PICA stands ready to work constructively with governments, policymakers, and stakeholders to ensure Australia’s tax and housing policies support a resilient and functional housing system for the long term.

ENDS
For a further information or to arrange an interview with Ben Kingsley – please call Ben Kingsley on 0403 795 252 or email bkingsley@pica.asn.au