From: c.oneill@trl.oz.au (Chris O'Neill)
Subject: Re: Negative Gearing
Organization: Telecom Australia Research Laboratories
Date: Fri, 20 Nov 1992 07:54:34 GMT

In article <1992Nov20.060507.29057@cs.su.oz.au> yar@cs.su.oz.au (Ray Loyzaga)
writes:
>In article <1992Nov20.000100.22566@trl.oz.au> c.oneill@trl.oz.au (Chris
O'Neill) writes:
>>In article <1992Nov19.071027.16215@cs.su.oz.au> yar@cs.su.oz.au (Ray Loyzaga)
>>writes:
>>>This stuff is still based on the belief that interest payments are
>>>not a genuine business expense, which is not the law and hence there
>>>is no loss by the tax office, they aren't entitled to it.
>>
>>Look, all I did was show the difference it made to the tax office when
someone
>>made this investment.  You tell me how the tax office is better off.  I said
>>absolutely nothing about believing that interest payments are not a genuine
>>interest expense.  Any conclusions regarding the tax deductability of the
whole
>>of interest payments came later.  So far there has only been a calculation of
>>the effect on the tax office.
>
>No you used the term "negative gearing" which has nothing to do with it.

I did a calculation of the reduction in tax received that the tax office
incurred as a result of someone using negative gearing.  You can play with
words all you like but that's what I did.

>>>You are picking on negative gearing, but the same effects occur
>>>with positive gearing, just in smaller amounts, what you are
>>>arguing for is that interest payments should not be tax deductable,
>>
>>I am not arguing that interest payments should not be tax deductable.
>
>Oh, yes you are...

Well why don't you try to be clearer?  Did you mean in the above that I am
arguing that interest payments should not be tax deductable at all or did you
mean that I am arguing that they should not be tax deductable in certain
circumstances?

>>I am arguing that negative gearing should not be allowed against income which
>>is independent of the loss.
>
>Negative gearing implies that there is no income except from other sources.

OK. Negative gearing should not be allowed.

>>> And yes I see your point about why we are
>>>going down the gurgler, 
>>
>>Yes, you're good at seeing points.
>>
>>>it is because most people can't understand
>>>the simplest of economic arguments, 
>>
>>Some people don't realize when they are leaving themselves wide open to being
>>accused of the same thing that they are accusing others of.
>
>Agreed.
>
>>
>>>and even those that can get part
>>>of the maths right can't get the underlying argument right.
>>
>>or have trouble getting it understood.
>>
>>>>The horrible realization is that what happened in the eighties can happen
all
>>>>over again, maybe not as severely but enough to ensure that Australias
>>>>distorted investment problem continues.
>>>
>>>Yup, and it has nothing to do with negative gearing.
>>
>>HA HA HA HA HA HA
>
>Like I said, since negative gearing is the bogey in your eyes, how come
>it only caused a problem in the late eighties???? 

Right. Interested in some education, I see.  Ever heard of financial
deregulation?

>Oh it was the high
>inflation ..., I guess the whole of the seventies and early eighties
>were just an aberration ... 

No, they were just before financial deregulation.  What bank do you think
Holmes a' Court borrowed his money from?

>or maybe your little idea needs a bit more
>refinement. 

Not as much refinement as our tax system.

>Now I know why you a laughing .... it was all a big joke!

Yes, the tax system is a joke, but it's on us.
Newsgroups: aus.politics