Finance News

From the monthly archives: May 2019

We are pleased to present below all posts archived in 'May 2019'. If you still can't find what you are looking for, try using the search box.

We are just as surprised as you!

Posted on Tuesday, May 21, 2019
We are just as surprised as you! Last week we were drafting franking credit emails, looking at alternative options for retirees, and contemplating negative gearing changes. Now all of that is in the bin - for the moment. The next issue for the Coalition is that given that they went into the election with a very modest set of policies, how they will govern from here? What are their big ideas for Australia? What kind of government will this be? The Coalition should not allow this unexpected triumph to be an excuse for complacency on their policy platform, or how they conduct debate within their parties. The Coalition’s surprise election win has given local stocks a healthy shot in the arm, sending the Australian share market surging to a fresh 11-year high on Monday. Bill Shorten and his proposed changes to negative gearing, capital gains tax and franking credits had been perceived by the market as detrimental. The challenge will now be for Scott Morrison to get his tax agenda through the pa ... Read the rest of entry »

Government first home buyer loan guarantees: BIG MISTAKE

Posted on Monday, May 13, 2019
Yesterday’s twist in the federal election campaign saw both sides of politics promise first homebuyers a home loan guarantee of 15%. This means that a buyer would only need to gather a 5% deposit in order to buy their first home, with the government guaranteeing the remaining 15% to the bank, totalling a 20% deposit overall. I believe this is a big mistake. It seems that our politicians on both sides have a very short memory. It was only about a decade ago that we saw the sub-prime mortgage crisis decimate the US housing market and flow on to feed the Global Financial Crisis.  In this circumstance, low-deposit loans led to home owners taking on more debt than they could afford to service, resulting in thousands of people across the US defaulting on their home loans, leaving the keys on the kitchen table and simply walking out. This is the risk we run, if we allow first homebuyers into the market with only a 5% deposit. But there are more reasons to ensure that the barrier to entry to the hou ... Read the rest of entry »

Is the ALP's small business tax cut discriminatory?

Posted on Monday, May 6, 2019
We’re two weeks out from the federal election and the Labor party have announced their package to woo the vote of business owners, as well as workers on the top and bottom of the age spectrum, by offering an incentive to employ younger and older workers. Under Labor’s plan, a small business will gain an extra 30% tax deduction on the wage of employees aged under 25 or over 55, if they have been unemployed for at least three months, or they are a carer returning to the workforce. This is the first sign the ALP has offered that they realise 5.7 million Australians either run a small business or are employed by one, and are looking to secure those votes. On face value, I’d take it as a win. I also note that this is the first election promise from either side that I’ve seen, that will actually put money back into the pockets of small businesses. The Coalition’s instant asset write off scheme offers a tax cut, but in order to take advantage of it, a small business must have the c ... Read the rest of entry »

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