IndieG

Sorry - I meant how would it impact you if at all. I hope the recommendation that income tax on savings be axed is implemented

Any idea what the impact on house prices would be, that is if they decide to implement the reported recommendation to remove discounts on Capital Gains tax and overhaul negative gearing?

ABCDiamond

What changes are going to be implemented then ?

mulben

Its just a White Paper still in discussion

ABCDiamond

Yeah, all 1,000 pages of it

iamthecreaturefromuranus

It will mean that I pay more tax... same as every other 'tax system review' since governments invented income tax.

IndieG

So is it going to be discussed and debated for years and then finally get implemented?

They're keeping the report under wraps and away from the opposition...so I guess some not so popular tax reforms/higher taxes to pay for the budget deficit.

I thought I read somewhere that it would be implemented this year

ABCDiamond

The government will release all the proposals this year, and then start to talk about them, then decide which ones they like, and which they don't.

Then they will table their choices in parliament and see if the options get passed by the elected politicians.

Probably after the next election after a rough guess...

IndieG

Right...thanks.

asprilla

CGT discount will most likely be removed.

Lets say that you purchased $200k worth of shares and then sold them 12months and 1 day later, for $800k. At the moment, only 50% of the $600k profit is subject to CGT. After the Henry review reforms are implemented, it is highly likely that there will be no discount... all $600k will be taxable.

This will have some knock on effects, in terms of whether an investor chooses to purchase assets with a high yield and low capital growth, or assets with high capital growth and minimal yield.

Geelong Gent

Well consider most investments are held in family or unit trusts

And what about high yield and high capital growth?

OzSheila

Just accept the fact that under the Australian taxation system if you earn a relatively good salary, in real terms you will pay about 85% tax and get nothing in return. There is no incentive to save and superannuation is one big con.

ABCDiamond

Good job the maximum Tax rate is 45%, but only over $180,000 per year

Tax on a $180,000 annual salary is $55,850 or 31.028%

Pollyana

In my experience any tax review means you end up worse off. Accept it, thats just life.
The only things that are certain are death and taxes.