Tax Exemptions Only Benefit the Wealthy

According to a report by the Organisation for Economic Co-operation and Development (OECD), an international organisation whose goal is to shape policies which foster prosperity, equality, opportunity and well-being for all, Australia’s lack of capital gains tax has led to a monumental increase in house prices that have unfairly impacted

the less wealthy.

The same report states that between 1981 and 2016, homeownership among the bottom 20% of Australian income earners aged between 25 - 34 dropped by 40%. A low income earning 30 year old is thus 40% less likely to own a home today than 30 years ago. In other words, this indicated that younger people were being locked out of the housing market which was, instead, being dominated by the older and much wealthier.

In Australia, the wealthy get more tax breaks. The poorest half of the country by income receives around 13% of the total tax relief for capital gains on their main residence, while the top 10% receive 37% tax relief, almost three times as much according to the same report. Renters, who tend to have lower incomes and wealth, on the other hand, do not receive any direct benefit from this tax exemption.