Most Australians pay their taxes and assume the system is fair. But new data tells a very different story. The country\u2019s biggest tax breaks \u2014 from capital gains to superannuation and negative gearing \u2014 are quietly helping the richest Australians grow their wealth faster, while ordinary workers fall further behind.<\/p>\n\n\n\n
When an investor sells a property or shares for more than they paid, they make what\u2019s called a capital gain. In theory, that profit should be taxed like income. But under current rules, if the asset has been owned for more than a year, the investor only pays tax on half the profit.<\/p>\n\n\n\n
This 50% capital gains tax discount means that someone in the top tax bracket, who would normally pay 47% tax, instead pays around 23.5% on their investment income. It\u2019s a massive saving \u2014 and one that doesn\u2019t apply to regular wages, reports News<\/a>.<\/p>\n\n\n\n Economists have long argued that this policy gives wealthy investors a huge leg up, allowing them to turn assets like property into tax-efficient income streams. Meanwhile, everyday Australians pay full tax on their paychecks, with little chance of accessing similar benefits.<\/p>\n\n\n\n Then there\u2019s negative gearing, a uniquely Australian tax rule that lets investors claim a loss on their rental property against other income. If your rent doesn\u2019t cover your mortgage and expenses, you can deduct that loss from your taxable income.<\/p>\n\n\n\n In simple terms, it\u2019s a way for high-income earners to lower their tax bill \u2014 while building long-term wealth through property. Around 1.1 million Australians now claim losses from negatively geared properties, but according to the Australian Taxation Office, most of them are in the upper income brackets.<\/p>\n\n\n\nNegative Gearing: A Property Investor\u2019s Bonus<\/h2>\n\n\n\n