Chartered Accountants ANZ’s Chief Economist, Professor Richard Holden, says today’s housing and tax policy announcements from both the Coalition and the Labor parties have clear weaknesses.
"The policies offered by both parties are much better politics than they are economics,” Professor Holden said.
"The Coalition's unprecedented mortgage interest tax deduction is costly to the budget, arbitrary in terms of who it helps, creates financial stability risks, and is hard to roll back.
"The Labor party’s ‘five percent deposit' policy raises many questions. Since the government is essentially providing mortgage insurance for low-deposit purchasers, what is the true cost?
“What happens if a buyer defaults? How are commercial banks treating these loans? Much more detail needs to be provided.
"Neither party has offered a policy which seriously boosts housing supply. They've provided more demand-side subsidies that tend to make housing affordability worse rather than better."
CA ANZ’s Chief Executive Officer, Ainslie van Onselen, reiterated the membership body’s long held call for major parties to commit to a meaningful discussion about the Australian taxation system.
“As we have called out in numerous submissions, the time has well and truly come for wider discussion about Australia’s tax system,” Ms van Onselen said.
“Our next Federal Government should announce a roadmap of how Australia will achieve meaningful tax reform. This needs to be the focus of tax discussions going forward.”
ENDS
For more information or to organise a follow-up interview with CA ANZ’s Chief Economist Richard Holden, please contact:
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AUSTRALIA Gillian Bowen, Public Affairs Manager Australia M +61 411 485 421
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Chartered Accountants Australia and New Zealand represents nearly 140,000 financial professionals, supporting them to make a difference to the businesses, organisations and communities in which they work and live. Chartered Accountants are known as Difference Makers. The depth and breadth of their expertise helps them to see the big picture and chart the best course of action.