The Home Isn’t a Loophole: A Response to Siminski and Wilkins
🏡 The Home Isn’t a Loophole: A Response to Siminski and Wilkins
By Anonymous Advocate, with Copilot (co-authorship acknowledged)
Part of the Generational Equity & Invisible Labor series on socialspaceblog.au
Peter Siminski and Roger Wilkins recently argued that taxing the family home could reduce inequality and benefit everyone. Their data is compelling. But their framing—like so much economic commentary—misses something vital: the human cost behind home ownership.
For many Australians, the family home isn’t a tax shelter. It’s the outcome of decades of sacrifice. It’s the quiet reward for unpaid care, interrupted careers, and the kind of invisible labor that never shows up in spreadsheets.
📉 The Numbers vs. the Narrative
Siminski and Wilkins show that when housing income is included, outright homeowners appear far wealthier than renters. They argue that the tax-free status of owner-occupied homes distorts the welfare system and entrenches inequality.
But here’s the problem: their analysis treats the home as an asset class, not a lifeline. It assumes privilege where many see survival.
The single mother who raised three kids while working nights and paying off a mortgage? She’s not gaming the system.
The carer who gave up paid work to support a disabled parent, who now lives in the only security they have—a home built not on privilege, but on love, exhaustion, and quiet determination.
The Gen Xer who missed the super boom, the housing boom, and the tech boom—but scraped together enough to buy a modest home in the suburbs? That’s not rent-seeking. That’s resilience.
🧭 Reform Without Erasure
Yes, we need tax reform. Yes, housing wealth plays a role in inequality. But if we’re serious about fairness, we must distinguish between speculative property portfolios and lived-in homes earned through sacrifice.
Policy should:
Exempt primary residences below a certain value or held long-term.
Recognize caregiving and unpaid labor as economic contributions.
Avoid framing home ownership as unearned privilege when it’s often the opposite.
📌 Sidebar: Is This About Unrealised Capital Gains?
While Siminski and Wilkins don’t explicitly call for taxing unrealised capital gains, their proposal edges close. By treating the value of living in one’s own home as untaxed income, they frame the home as a source of economic benefit—akin to unrealised gains.
Unrealised gains refer to increases in asset value that haven’t been cashed out. In Australia, these are not taxed unless the asset is sold.
Principal residences are exempt from capital gains tax, even when sold—recognizing their unique role in personal security.
Why it matters: Taxing imputed rent or housing income risks penalizing those who’ve already paid in invisible labor. It treats emotional and social value as taxable wealth.
This shift in framing—from shelter to speculative asset—has real consequences. It flattens effort, erases caregiving, and opens the door to taxing what hasn’t been earned or sold.
🛑 Redistribution Without Recognition
There’s a growing tendency in policy circles to treat redistribution as a moral cure-all. But redistribution without recognition flattens effort. I didn’t sacrifice a lifetime of work, missed holidays, and financial strain to see that legacy taxed away under reforms that overlook the value of care, effort, and quiet resilience.
Australia already ranks among the highest-taxed nations in terms of personal income tax increases. In 2023, Australians experienced a 7.6% rise in average income tax rates, the largest increase among OECD countries. While our overall tax-to-GDP ratio is below the OECD average, the burden on individual earners—especially middle-income workers—is rising sharply due to bracket creep and the end of key offsets.
If we’re going to talk about fairness, let’s start by asking: who’s already paid?
🕊️ A Legacy, Not a Loophole
The family home is more than bricks and equity. It’s where grief was held, children were raised, and futures were quietly built. Taxing it without nuance risks punishing those who’ve already paid in ways economists rarely measure.
Let’s reform with empathy. Let’s count what counts—and ensure that those who’ve carried the weight of care and sacrifice aren’t asked to carry the cost of reform too.
📚 Sources & Footnotes
Siminski and Wilkins argue that the tax-free treatment of owner-occupied housing distorts income inequality and undermines the progressivity of Australia’s tax system. See ABC News and The Conversation.
Treasury estimates it forgoes over $50 billion annually by exempting owner-occupied housing from capital gains tax and imputed rent.
Including housing income reduces the redistributive impact of income taxes by 40.5%, and government transfers by 18.9%, shifting Australia’s inequality ranking from 16th to 10th among OECD nations.
Unrealised capital gains—such as the increase in home value without sale—are currently not taxed in Australia. However, proposals to tax imputed rent and housing income conceptually overlap with unrealised gains. See PAC Financial and Hudson Financial Planning.
Australia’s personal income tax burden rose 7.6% in 2023, the highest increase among OECD countries, driven by bracket creep and the end of the Low and Middle Income Tax Offset. See ABC News.
The CGT exemption for the family home has been critiqued for undermining equity and encouraging over-investment in housing. See Firstlinks.
Generational equity and invisible labor—especially among older Australians and carers—remain underrepresented in mainstream policy. See EEON’s report on intergenerational exclusion and the Australian Public Service Commission’s multigenerational workforce analysis.
