Unaffordable housing ‘the biggest social problem’ facing Australia: Allegra Spender

Independent federal member for Wentworth, Allegra Spender (pictured), discussed how the current tax settings in Australia are inhibiting the ability of younger Australians to get ahead financially at a recent Punters Politics event last week.

It follows the release of her Personal Tax White Paper on 11 March, which proposed a detailed tax reform plan to make Australia a country where everyone can get ahead "off their own back”.

One of Spender’s aims in her white paper was to rebalance the tax system to help younger Australians enter the property market.

The proposal sought to rebalance the personal income tax system by reducing taxes on wages and salaries while cutting tax concessions on income from assets.

This cut to income taxes for wages and salaries would be funded by reducing the capital gains tax discount (CGT) from 50 per cent to 30 per cent, ring-fencing negative gearing, setting a minimum tax rate for investment income and making changes to superannuation taxes.

As previously reported by Accounting Times, the reduction of the CGT discount also garnered support from the Greens, with Barbara Pocock seeking to cut the CGT discount entirely.

Spender spoke at Politics at the Pub with Konrad from Punters Politics on 19 March, where she highlighted the key problems that her white paper aimed to address: a lack of financial security for younger Australians and high taxes being imposed on people under the most financial pressure.

“We haven’t had substantial tax reform for 25 years, and the current system is no longer fit for purpose,” Spender said.

“I do think everyone in this country should have access to housing. The biggest single social problem in this country is the unaffordability of housing.”

“If you make the choices that your parents or your grandparents did, you're not going to get the same results. That's the problem.”

In a statement, Spender argued that the government’s increased spending on health and aged care places a heavier burden on younger workers, opposing “fantasy tax reform”, which promises tax cuts without showing how they will fund them.

“Does it really make sense that the tax burden falls most heavily on younger people struggling to get established – who are likely also paying rent, saving for a deposit, raising children, and paying down HELP debts?”

She added that when people believe the system is not on their side, they will stop believing in the system altogether.

“Every dollar returned to working Australians through my proposed income tax cuts is raised by reducing concessions on investment income.”

“That will not only assist younger Australians, it will also improve productivity and address the long-term demographic challenges facing our tax system.”