The debate over Australian housing affordability has reached a boiling point. With a growing population, skyrocketing rents, and First Home Buyers feeling locked out of the market, the government is looking for a silver bullet.
Right now, rumors of massive changes to the Capital Gains Tax (CGT) and negative gearing are making daily headlines. But we have to ask the hard question: Will taking an axe to property investment actually fix the crisis, or will it just pull the rug out from under the rental market?
There is a lot of political spin and misinformation out there—especially the myth that everyday investors are simply "crowding out" First Home Buyers. (Spoiler: We actually fund up to 90% of all new housing stock!)
To set the record straight, PICA Chair Ben Kingsley went behind the curtain to analyze the real-world impact of the tax policies currently on the table.
The Policy Scorecard: Who Passes and Who Fails?
In this essential breakdown, we grade the proposed tax reforms from the Labor Party, the Greens, the Grattan Institute, and the latest Treasury leaks. We test every single policy against the government's three ultimate objectives:
- Protecting Housing Supply: Do they incentivize new construction and keep rental prices down?
- Immediate Revenue: Do they help the government manage mounting debt?
- Leveling the Playing Field: Do they clear the path for First Home Buyers by deterring short-term speculators?
Unfortunately, most of the proposals on the table fail the test, triggering a "loss aversion" effect that will devastate new housing supply and cripple State Government stamp duty revenues.
The Winning Solution
It isn't all doom and gloom. There is one balanced, tiered CGT policy that satisfies investors, renters, First Home Buyers, and the government—and it’s a policy PICA has been championing since 2019.
Watch the full breakdown video above to see the math behind the politics, and discover the one tax policy that actually works.
00:00 - Introduction: The Big Housing Debate
01:59 - The #1 Capital Gains Tax Misinformation
02:58 - Labor's Intergenerational Inequality Message
08:56 - The "Crowding Out" Myth: Does Math Add Up?
12:12 - Leveling the Playing Field for First Home Buyers
15:11 - What's Labor's Hidden Agenda here?
24:09 - The Voter Ecosystem - Who is impacted?
30:26 - The Policy Scorecard: Grading the Government's Options
30:47 - Proposal 1: Labor’s 2016/2019 Election Policy
33:17 - Proposal 2: The Grattan Institute Proposal
34:54 - Proposal 3: The Treasury "Secret" Model (AFR Leak)
38:29 - Proposal 4: The Greens' Tax Policy
39:40 - The 1999 Fact Check: Why the 50% CGT Discount Exists
40:59 - The Winning Solution: PICA's Balanced Tax Policy
Have Your Say
Housing impacts everyone in this country, which means it is critical that we have the right debate.
- Read the Policy: Want to dive deeper? [Click here to read PICA’s comprehensive Policy Document.]
- Join the Conversation: What do you think is the best way to fix the housing crisis?
- Support the Cause: If you are one of the 2.3 million everyday property investors in Australia, make sure your voice is heard. [Join the PICA community today.]
