ATO data for the 2021-22 period reveals that surgeons and anesthetists were the top two earning professions, with internal medicine specialists and psychiatrists also ranking among the top 10 occupations by average taxable income. This data has sparked a debate about the distribution of benefits from tax concessions. The Australia Institute’s analysis shows that the richest 10% of the population receive more than half of the benefits from the capital gains discount and tax rental deductions. However, the Property Council argues that lower-paid and essential workers also benefit from negative gearing, particularly when considering the total number of taxpayers who are negatively geared by occupation.
According to the tax office data, a significant number of registered nurses, secondary school teachers, and infant or primary school teachers had at least one negatively geared investment property in 2021-22. This highlights the prevalence of negative gearing among a diverse range of professions, not limited to high-income earners. Shadow treasurer Angus Taylor emphasized the importance of maintaining a policy framework where mum and dad investors can continue to be landlords, rather than allowing big corporations or investment funds to dominate the rental market. Both major political parties are prioritizing housing issues in the lead up to the next federal election, recognizing the impact of policies like negative gearing on various sectors of the population.
Independent senator David Pocock suggested that potential changes to negative gearing could provide additional government revenue to fund housing supply initiatives. He proposed a “sensible middle path to reform,” which would involve grandfathering existing arrangements while restricting negative gearing to one property per individual in the future. This approach aims to strike a balance between maintaining investor incentives and addressing concerns about housing affordability and supply. The ongoing debate surrounding negative gearing reflects a broader discussion about wealth distribution and the role of tax concessions in shaping economic outcomes.
Overall, the ATO data on high-earning professions and negative gearing highlights the complex dynamics of Australia’s tax and housing policies. While certain professions benefit from tax concessions, such as surgeons and anesthetists, the widespread use of negative gearing across diverse occupations complicates the narrative of wealth distribution. Political figures like Angus Taylor and David Pocock are advocating for policy reforms that balance the interests of investors with the need for affordable housing and adequate supply. The upcoming federal election is likely to see housing issues take center stage, with both major parties grappling with how to address concerns about inequality, affordability, and access to homeownership. As stakeholders navigate these debates, transparency and informed decision-making will be essential to shaping a fair and equitable tax system that benefits all Australians.
