According to ATO data for the 2021-22 period, surgeons and anaesthetists emerged as the top two earning professions, followed by internal medicine specialists and psychiatrists among the top 10 occupations by average taxable income. This data has sparked tensions over the distribution of benefits from tax concessions. The Australia Institute’s analysis reveals that the wealthiest 10 percent of individuals receive more than half of the benefits of the capital gains discount and tax rental deductions. On the other hand, the Property Council has argued that lower-paid and essential workers, such as nurses and teachers, are among the primary beneficiaries of negative gearing when considering the total number of taxpayers who are negatively geared by occupation.
In 2021-22, there were 27,639 registered nurses, 14,946 secondary school teachers, and 13,556 infant or primary school teachers who owned at least one negatively geared investment property. Shadow treasurer Angus Taylor highlighted the role of mum and dad investors in the housing market, stating that the current policy settings allow individuals from various professions, including plumbers, nurses, and teachers, to become landlords. Taylor emphasized the importance of maintaining this diversity in the housing market and preventing big corporations and investment funds from dominating the rental market. Both major political parties have identified housing as a key issue in the upcoming federal election.
Independent senator David Pocock suggested on Friday that introducing changes to negative gearing could potentially free up government funds to address housing supply issues. Pocock proposed a “sensible middle path to reform,” which would involve grandfathering existing arrangements and limiting negative gearing to one property per individual going forward. By implementing such changes, Pocock believes that the government could efficiently allocate resources to address the housing affordability crisis. The debate surrounding negative gearing and tax concessions in the housing market continues to be a focal point in federal politics, with differing perspectives on how best to address these issues.
Overall, the data from the ATO highlights the disparities in income distribution across various professions, particularly in relation to tax concessions and benefits like negative gearing. While high-earning professionals such as surgeons and anaesthetists dominate the top earners list, lower-paid essential workers like nurses and teachers also benefit from tax concessions. The ongoing debate over negative gearing and housing policy underscores the need for a balanced approach that addresses affordability issues while ensuring the diversity of property ownership in Australia. As the federal election approaches, both major political parties are expected to present their respective housing policies to address these challenges and meet the needs of a diverse range of Australians.
