Aug 232007

Makes you wonder just who’s zoomin’ who. John Winston indicates that he’ll consider John Symons’ plan to incentivise new home buyers, while Peter Costello rules out the idea.

Costello claims that

“We have never had deductibility of mortgage interest and the reason we’ve never had it is we keep houses out of the tax system,”

while any investor knows full well that tax deductions have been claimable on investment borrowings for homes for decades. Additionally, if you happen to sell your principal place of residence within twelve months of purchase, and make a capital gain on it, you pay capital gains tax. Therefore this slant that ‘we don’t have houses in the tax system’ is a complete and utter furphy. Costello knows this, which prompts me to ask just why he’s flatly ruled out the suggestion.
Additionally, and amusingly, mere hours after Costello flattens Symons’ idea, John Howard pops up and indicates the plan has some merit because he’ll give it consideration. Is this a slap in the gob for Costello, or another election ploy which will be examined closely until election day, but nothing concrete resolved before then?
If you ask me, it’s a bit of both. A chance to slap down the pretender, and make some election hay without making any promises, core or non-core.

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