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Exactly. Real investments - as distinct from tax driven transactions - are supposed to to make a quid from the business, not in the capital gain of same. HG's Gruen Transfer ad (there's a bloke with too much time on his hands :) ) makes the point well. I like property and have done very...

Yes, because it's hugely expensive, provides no indisputable economic benefit and is inflationary. It's not economically sensible because...it's not economically sensible. Outcomes matter and NG doesn't deliver outcomes that merit the cost.

Apples and oranges. The taxation rights and obligations of companies and PAYG are fundamentally different (CGT, FBT etc etc). As I've mentioned before, the reason RE investors don't generally establish company structures in spite of the asset protection it provides it that it provides a poorer...

A good example of why ultimately the govt. will go through NG like a dose of salts. Interested in the forum's view of the public good/entitlement arguments around this one (othe than "cos we can"): http://www.propertyinvesting.com/forums/property-investing/help-needed/4325442?t=1217413056

*sigh* (1) Companies get to offest losses WITHIN THEIR BUSINESS. They don't get to offset it against PAYG. As I've said, no issues with anyone starting a company for their RE investment and accessing EXACTLY THE SAME TAX BENEFITS AS ANY OTHER COMPANY. You.Are.Not.A.Company. (2) How...

:p We do it to obtain a capital gain. They can acquire and manage the assets cheaper than we can. They get the same same capital gain. They (we, as taxpayers) make more quids or, alternatively, see a reduction in housing costs. If the government invests money to enter the same...

Vince, Re-read my post. My issue is offsetting contrived losses against PAYG income. Companies do not get to do that. As I said, have no issue with any investor setting up a company for geared invesment and running it exactly the same way and under the same rules.

So why should the taxpayer subsidise gearing against property or shares?

Rubbish. This isn't about fairness, it's about effective application of government capital (taxpayer's money). Let's say a government figured the best way to keep rent down and properties available was to subsidise the cost of borrowing to enable landlords to purchase properties. If new...

LAA replied and asked a couple of questions including: Ok, what would be your solution to your perceived problem of NG tax benefits; where would you re-allocate the funds so that the Govt still received more dollars for the coffers, but didn't destroy the IP investment climate we have today...

Business don't get to offset losses from PAYG earnings. Set up a company, submit yourself to the same regulatory and tax environment and then you can claim to be running a business. Businesses (as a consequence of the above) don't deliberately structure their affairs to make a cash-flow loss.

I'm resentful of poorly managed or strategically dumb government spending, wherever it is. Don't have an issue with anyone taking advantage of the stupidity of governments (been there, done that), but the attempts by NG (property and equity) beneficiaries to take high moral ground on the issue...

Sooooo, (and don't take this the wrong way), it's basically a self-interest argument. That is, if a better overall outcome be it (a) savings or (b) housing affordability/availability could be gained by transferring the Govt's financial contribution to PAYG investors elsewhere, the "possession...

Responding to dave99, LA typed the following. Token Funder hopes that LA's patience will extend to clarifying some points: The Govt introduced those rules, because it is far cheaper for them to pay us tax deductions to provide the housing than it is for them to cover the cost of the...

This conversation reminds me of the time I've spent in Darwin and FNQ over the last few years. Those areas are populated from base to apex with faux capitalists. Aggressively independent, entreprenuerial, anti government involvement in everything *except* they are addicted to handouts...

Though I personally am against negative leveraging across all investment classes (as I highlighted earlier, tax-driven managed investment schemes are seriously screwing with legitimate agri-business), the key difference with RE is that it is not simply an generic asset class. Inflationary...

Company structures would lead to loss of the CGT reduction and make RE investment less attractive compared to current arrangements. Credit is also less convenient under a company structure in that lenders tend to require more info or more % (relative to the 'ol Lie Doc caper). Either way and...

My point is that an opportunity exists to determine whether you can reduce demand and increase supply through reallocation or restructing of NG across the RE sector. Price pressures are caused by too much money chasing too few assets. On the demand side, easy credit drives house prices and...

Exactly. Which begs the question, could the $8B in IP subsidies be utilised in another fashion that *will* increase the construction of new houses? Putting our own self-interest aside, it seems to me that all the evidence points to the fact that negative gearing as currently structured is...

Nope...businesses aren't also PAYG taxpayers and their tax deductibility isn't skewing a major market. As I said before, you have to look at the impact of the benefit compared with the intention. It has always seem sensible to me that the cash-flow losses simply be rolled forward and deducted...