ACT would let landlords offset rental losses against other income

Summarised by Centrist

ACT leader David Seymour wants to reverse Labour’s residential rental loss ring-fencing rules, allowing landlords to offset new losses against their other taxable income.

The proposal would apply to losses incurred after the policy takes effect. Previously accumulated ring-fenced losses would remain under existing rules.

Seymour argues the change would bring residential landlords into line with sole traders and commercial property investors, improve cashflow and make repairs and further investment more affordable.

“There’s no such thing as a tax on landlords that renters can safely ignore,” he said.

Seymour linked higher rental costs to Labour’s tax policies. Labour attributes recent rent stabilisation to reduced demand as more people leave the country.

ACT’s fiscal plan forecasts a revenue reduction of $264 million in the first year, rising to $303 million in year four.

Seymour described the proposal as bringing deductions forward, but acknowledged that some losses might never be deducted under current rules.

“So, we can’t say the policy has no fiscal cost,” he said.

Read more at Stuff

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