Time to end the landlord’s tax break says NAB

People who put their money into savings accounts should get the same tax breaks that property investors get said NAB chief executive Ahmed Fahour. Tax policy favouring property investment had contributed to low rates of saving. Banks are looking for new sources of funding in the wake of the liquidity crisis in global debt markets. The amount of money in property is now 26 times the rate of 20 years ago said Mr Fahour. Experts said the governments would be unlikely to take away a tax benefit and repeat the Keating experiment that had driven up rent and dried up supply. An academic said negative gearing on investment property had increased demand without stimulating a supply response because most investors buy existing homes. Tax policy was therefore encouraging the turnover of existing properties.

Source: The Australian Financial Review/AAP