In 1985 - the original CGT was that you paid on the adjusted gain after inflation. In 1996 - they took housing costs out of the inflation figures. In 1985 - to get the tax reforms across the line, the principle place of residence was exempted from CGT for a period of 6 years which equates to two terms for a house of reps MP or 1 term for a senator. Bottom line we have had no meaningful taxation reforms since 1985. This country should have been a net exporter of capital , but Australians are greedy, impatient and easily distracted. We are a nation with ADHD In some Cantons in Switzerland or well run states in the USA, vacant properties have to pay tax on shadow earnings. The incentive is then for the property to be producing some form of actual income rather than land banking or being held as part of a trust. Finally to quote Paul Keating. If you want good policy outcomes you have to remember that people are like donkeys 40% will chase a carrot and 60% have to be hit with a stick.
