The Election 2019: How Will Each Parties Policies Impact You?

With the election looming, and Australia potentially looking to try a full term Prime Minister for the first time since the Howard era, many voters are still on the fence when it comes to who to vote for. Whilst this decision is up to yourself, we thought it would be worthwhile to cover off on a couple of key election items that may or may not impact you to help in making up your mind.

House Prices

The Labor party is looking to eliminate negative gearing on existing properties from January 1 2020, and instead only apply these to new dwellings. The policy also includes halving the Capital Gains Tax discount for assets held longer than 12 months (from 50% to 25%). The Liberal party at this stage are not looking to make any changes in this area.

According to 2016/2017 ATO data, 64% Of property investors had a taxable income under $80,000.00 per annum, whilst approximately 7% of those claiming a negatively geared property earned over $180,000.00. Therefore, this policy is most impactful for the majority or lower-middle class Australians.

It is likely that should this change be implemented, it will place further downward pressure on house prices as investors look to leave the market (or fewer investors look to enter the market). This is also a concern for renters, as with less investors essentially subsidising the rental market through negative gearing, supply will reduce, which in turn will result in higher costs for renters.


Australia has the highest wage cost in the world, which makes it an expensive place to manufacture goods. The Labor party have advocated a strong stand on climate change (which includes an emissions trading system, and 50% renewable energy generation by 2030), however this policy remains un costed.

Whilst the environment is a key topic for many voters, from a purely economic point of view, with the already high cost of energy and wages, any further increases to energy prices will serve to make Australia a less attractive proposition for investment, which it turn reduces the likelihood of a consistant flow of large scale projects and the associated employment opportunities.


The Labor party advocate fixing stagnating wage growth, and reversing changes to penalty rates. It is worth noting that the decision around penalty rates are determined by the air Work Commission, not the government. Therefore if this commission is truly independent, the government cannot make this happen. It is also important to note that approximately 70% of GDP is tied to small businesses – these are the businesses that are most impacted by penalty rates, and can least afford to open out of ordinary working hours.

In a country that has the highest wages in the world, where in some cities (Perth) approximately 1 in 5 retail spaces is currently vacant, any increases in wages not in line with inflation would seem to jeopardise an already ailing economy.


The Labor party are looking to abolish refunds available on franking credits, when an individual has leftover franking credits and a tax bill of zero. This is likely to impact self funded retirees with a share portfolio, who factor this refund in to cover their annual living costs.

The Liberal party are looking to slash personal income tax by close to $300 billion over the next decade. The eventual outcome of this policy would result in the 19% tax rate applying for those earning up to $45,000.00, and a 30% tax rate applying to those earning between $45,000.00 and $200,000.00.

According to the Grattan Institute, high income earners would benefit the most. Currently the top 20% of wage earners in Australia pay 68% of the tax generated, whilst after this change is fully implemented this would drop to 65%


Whilst we can’t tell you who to vote for, we can help you figure out where to source funds! If you are looking for finance, please contact one of the team at Flexible Capital.

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