Australian Property News
Keating never forgave me over negative gearing: Bernie Fraser
Posted on Wednesday, December 02 2009 at 4:46 PM
Former Reserve Bank governor Bernie Fraser says ex-prime minister Paul Keating has never forgiven him for persuading him to make changes to negative gearing, however he's still hoping an impending tax review will call for changes to capital gains tax and negative gearing allowances.
Fraser says he hopes the soon-to-be-released Henry tax review, chaired by Treasury secretary Ken Henry, will turn to fiscal policy to supplement monetary policy.
Fraser says he will continue to push for changes to capital gains taxation and negative gearing as a way to more equally distribute the nation's taxation burden.
"I helped persuade Paul Keating to move in that (negative gearing reform) direction once and it was in place for a short time before it was rescinded and Paul Keating hasn't forgiven me," Fraser told the Whitlam Institute.
"I'm hoping that the tax review will start by producing a fairer tax system. Fairness, it seems to me, is something that everyone pays lip service to and then forgets to do much about."
Fraser said he felt a fair tax system should treat a dollar the same "whether it's a dollar earned through wages or through capital gains".
Preferable differential rates between capital gains tax and income tax are unfair, he says.
"It encourages people, those who can, to channel more of their income through capital gains than the income tax structure generally," he says.
Henry is conducting a wide-ranging review of Australia's tax system and is due to present his findings to the Federal Government this month.
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