Turnbull delivers for electorate – Capital gains tax discount by electorate

New research from The Australia Institute has found that the Prime Minister’s electorate reaps the greatest benefit from the capital gains tax discount, by a large margin.

The CGT discount is expected to cost the budget $9.6 billion dollars this year (2016-17) $44 billion over the next four years. Historical data also shows that, in combination with negative gearing, the CGT discount has contributed to Australia’s housing affordability crisis.

“The benefit of the CGT discount mainly flows to Liberal electorates in large cities. As it happens, the Prime Minister’s electorate leads by a large margin,” Senior Economist at The Australia Institute, Matt Grudnoff said.

Table – Top 10 electorates by CGT discount

Rank

Electorate

State

Party

Benefit

Representative

1

Wentworth

NSW

Liberal

$5,387

Malcolm Turnbull (Prime Minister)

2

Higgins

VIC

Liberal

$3,448

Kelly O’Dwyer (Assistant Treasurer / Minister for Revenue, Financial Services)

3

North Sydney

NSW

Liberal

$2,349

Trent Zimmerman

4

Melbourne Ports

VIC

Labor

$1,861

Michael Danby

5

Tangney

WA

Liberal

$1,848

Ben Morton

6

Kooyong

VIC

Liberal

$1,748

Josh Frydenberg (Minister for Environment and Energy)

7

Warringah

NSW

Liberal

$1,706

Tony Abbott (Ex-Prime Minister)

8

Goldstein

VIC

Liberal

$1,602

Tim Wilson

9

Brisbane

QLD

Liberal

$1,350

Trevor Evans

10

Sydney

NSW

Labor

$1,275

Tanya Plibersek (Deputy Opposition Leader)

Source: Commonwealth of Australia (2017) Taxation Statistics 2014-15 – Individuals detailed Table 6 and author’s calculations

“The Capital Gains Tax discount is a highly inequitable tax break, with 75% of the benefit going to the top 10% of earners. This research shows that the benefits are also geographically concentrated.

“Alternatively, if the government were to reform the CGT discount instead of cutting welfare then some of the biggest winners would be National Party electorates,” Grudnoff said.

Table – 10 electorates with lowest benefit from CGT discount

Rank

Electorate

State

Party

Benefit

Representative

150

Kingston

SA

Labor

$66

Amanda Rishworth

149

Port Adelaide

SA

Labor

$73

Mark Butler (Shadow Minister for the Environment)

148

Kennedy

QLD

Independent

$82

Bob Katter

147

Makin

SA

Labor

$86

Tony Zappia

146

Blair

QLD

Labor

$89

Shayne Neumann

145

Mallee

VIC

National

$90

Andrew Broad

144

Maranoa

QLD

National

$94

David Littleproud

143

Parks

NSW

National

$96

Mark Coulton

142

Lyons

TAS

Labor

$96

Brian Mitchell

141

Wakefield

SA

Labor

$97

Nick Champion

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