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The Guardian - AU
The Guardian - AU
National
Patrick Commins Economics editor

Capital gains discount and negative gearing turbocharged property speculation and pushed up prices, analysis finds

Prospective buyer looks at a property before an auction in Sydney
Australia’s capital gains tax discount and negative gearing rules have fuelled property investments and house prices rises, an e61 Institute report has found. Photograph: Mark Metcalfe/Getty Images

The combination of the capital gains tax discount and negative gearing rules has turbocharged debt-fuelled property speculation over recent decades, according to a new analysis of hundreds of thousands of property investments.

The federal budget in three weeks’ time is widely expected to include changes to tax breaks for investors, in an effort to rebalance the tax system away from the wealthiest Australians and to take pressure off home prices.

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