It can work well when the value of the asset increases over time. It is popular in Australia because when a property is bought to be put out for rental, the loss is tax deductible and can also be offset against other income, meaning less tax is also paid. Labor leader Anthony Albanese dumped Bill Shorten’s negative gearing policy. That is, where the income or profit is less than the expenses, after the interest on the loan to buy is taken into account. Negative gearing is defined by the Australian Tax Office as making an investment that’s running at a loss. The government should be looking instead at giving tax breaks to people making good decisions.” If you’re choosing a property because you can then negatively gear it, that’s an absolutely crazy investment decision. “It gives you a tax break for losing money, which makes no sense at all to me. “I have another name for negative gearing: stupidity,” Mr Kiyosaki said. That was despite Labor abandoning its previous intent – taken to the 20 elections – to limit, or scrap, negative gearing.
Last year, Treasurer Josh Frydenberg identified housing taxes as a key issue before the federal election. Robert Kiyosaki: “I have another name for negative gearing: stupidity.” The American author of the best-selling book Rich Dad Poor Dad is urging for a debate about negative gearing to take centre stage during the upcoming federal election campaign. Investment adviser Robert Kiyosaki says the Australian government should axe negative gearing to provide an incentive for property buyers to choose wisely rather than “reward them for bad decisions”.
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