Gearing up for a low-tax future
With superannuation spared from major tax increases in the May 14 budget, attention is now focused on other possible tax-shelter changes, including negative gearing and pre-payment of interest. Based on past experience, the odds on any major changes to the gearing rules in an election year are very low.
Political outcries have foiled all previous attempts to change negative-gearing tax rules, and as a result are not being publicly raised by Treasury, even now. Even if the maximum deductible superannuation cap is raised to $35,000 for the over 50s, the prospect of a new tax on larger superannuation pensions will encourage more higher-income taxpayers to increase their gearing activities.
Read the full article: Gearing up for a low-tax future (subscription required)