Calls for the Federal Government to scale back negative gearing are misguided and risk ruining a natural “stimulus package” for the housing and renovation industries, a leading property expert warned today.
DEPPRO Asia Pacific managing director Paul Bennion said he was dismayed that the Community Tax Forum had taken aim at negative gearing and criticised property owners for being able to claim tax deductions against improvements to rental homes.
“Tax incentives like depreciation are a valuable tool to help and encourage investors to keep their rental properties well maintained,” he said.
“This benefits tenants, of course, but also has a wider impact on the community and economy.
“It encourages spending and provides a major boost to the renovation industry and flows on to all those people employed in building trades and the provision of items such as whitegoods, floor coverings, and furnishings.”
Mr Bennion said Australia was facing a housing shortage, with rental properties particularly in demand.
“Vacancy rates are below 2% in all Australian capital cities except Perth and Canberra, where they are only just over 2%,” he said.
“The last thing the Government should be doing is making it harder for property investors to enter the market or build their portfolio.
“This is a time when Australians need to be investing in housing and providing well-maintained homes for people who do not yet own their own – or are choosing to rent for other reasons.”
DEPPRO Asia Pacific is Australia’s leading specialist in tax depreciation allowances for investment properties.
The company has generated more than $12.8 billion in tax deductions for its clients.
“The majority of this money has gone straight back into the economy and supported the residential building industry,” Mr Bennion said.
“At a time when experts are looking for ways to stimulate the economy, it would be foolish to turn off the tap for investors.”
For more information on depreciation you can phone Deppro, the depreciation professionals on 1300 888 489 or visit www.deppro.com.