TAX reform is shaping up as the big topic for 2016, so prepare yourself for the good, the bad, the ugly and the downright stupid.
And if there were a contest for stupid ideas, one that was floated recently would have to be a strong contender for first place.
AMP chairman Simon McKeon suggested it was time to consider capital gains tax on the family home.
Any government that brought in CGT on the family home would create a nightmare.
As the law stands, all expenses for non-income producing properties bought since August 20, 1991 can be added to the base cost.
Typical examples are a beach house that is not rented out, or vacant land.
So, if you bought a beach house in 2007 and borrowed money to buy it, you could claim all your interest, as well as rates, land tax, insurance, maintenance etc.
As the property is not income-producing, there is no deduction allowed for these items each year - but they are added to the base cost and so reduce any CGT payable when the property is sold.
The family home would follow the same rules. That is, before levying CGT, the base cost would need to be adjusted for all claimable expenses since the home was purchased.
The record keeping would be horrendous. Given that many people spend more on interest than the purchase price of the property, and interest is generally the biggest expense, I can't see much CGT ever going to the government.
It would also be difficult to levy the tax retrospectively because records are required to be kept for only five years.
Therefore, the tax would have to take effect from a date in the future, and that would require every property to be valued at the date of introduction of the tax.
It really is a ridiculous idea.
*Noel Whittaker is the author of Making Money Made Simple. His advice is general and readers should seek their own professional advice before making any financial decisions. Email: firstname.lastname@example.org
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