Corridors of Power – 25 August 2015

Corridors of Power – 25 August 2015Treasurer Joe Hockey proposes income tax cut for the next election, Australia’s treasurers meet to discuss tax reform, new foreign investment laws introduced to Parliament and Minister Scott Morrison confirms support for negative gearing. Stay up-to-date with all the latest government developments affecting the property industry here each week.Tax reform is again firmly back on the agenda with Treasurer Joe Hockey announcing on Monday that the Government will take the issue of personal income tax cuts to the next federal election. Hockey’s pledge comes on the back of comments last week echoing Property Council calls for a better tax mix to stimulate the economy, including removing stamp duty, our most inefficient tax.Last Friday State and Territory Treasurers met in Canberra to discuss improvements to the Australian tax system. The key point reiterated at the meeting was that any changes to the base and rate of the GST can only take place by unanimous agreement. With that in mind, the Treasurers were committed to keeping all options on the table and to continuing to work on plans for a better tax system.Treasurer Joe Hockey introduced new laws to enhance the operation of Australia’s foreign investment framework. The Property Council acknowledged the Government’s consultative approach to the reform package to ensure compliance with foreign investment rules, but cautioned that these measures will not address housing affordability concerns.Improving housing affordability is linked to increasing new housing supply. Social Services Minister Scott Morrison last week reiterated the Government’s support for negative gearing. This comes on the back of both Prime Minister Tony Abbott and Treasurer Joe Hockey ruling out any changes to the system. Morrison argued that, “The average person who was engaged in investing in residential real estate using those arrangements has a taxable income of around about $80,000 a year and they own one property.”The National Broadband Network (nbn) also released its 2016 Corporate Plan. Currently about one in 10 Australians have access to the nbn, but by June 2018 this will rise to around 75 per cent. The Property Council has been working directly with nbn providing exclusive Member Briefings regarding the delivery of telecommunications infrastructure in new developments. This week the road show will continue in Adelaide.