Reverse tax cuts for landlords

What is the problem that this change would seek to address? 

In 2024 the government decided to allow landlords to subtract the interest they pay to the bank for their mortgage on an investment property from the tax they owe - known as “interest deductibility". 

This was essentially a $2.8 billion dollar tax cut that went to landlords - who by definition are wealthy enough to own a property they don’t live in, whereas ordinary people are not able to subtract the mortgage interest on their family home from their tax bill. What’s more “interest deductibility" encourages investing in property, which has the effect of making housing more unaffordable.

And this decision also reduced our collective resources to pay for things like hospitals and schools by $2.8 billion! 

How would reversing interest deductibility work?

We would simply remove the ability for landlords to subtract the interest they pay on their mortgage for investment properties from their tax bill - this was the status quo before 2024. 

Why would this be better?

This would create a more level-playing field, removing a tax advantage for landlords and an incentive to invest in property. This may encourage investment in productive businesses that create jobs and reduce the pressure on the housing market.

Importantly, this will replenish our collective pool of resources with billions that can be spent on the things that support everyone to succeed, like free school lunches and doctor’s visits.