The 50% CGT discount applies to all investments that are held for more than 12 months.
As does negative gearing. Margin loan interest is offset in the same way.
Clearly more Australian's feel comfortable investing in property than other asset classes.
But these two tax rules encourage Australian's to invest and provide for their families and their own retirement. Therefore reducing the burden on the tax payer to fund pensions.
By removing the CGT discount you are essentially saying to the public that if you want to invest to get ahead we are going to take a bigger slice of it. Therefore reducing the incentive to do so.
If they only remove it from property investment you then force more funds into the share market. Shall we create a bubble there instead? Shares are much quicker, cheaper and easier to sell which is part of the reason that booms and crashes occur more frequently.
