THE ROLE OF TAXES IN PROMOTING THE EXPERIENCE OF HOME FOR TENANTS
Abstract
Tenants and owner-occupiers experience housing differently both in terms of wealth and consumption. An owner-occupied property is typically a person’s primary investment as well as a shelter, whereas a tenant also enjoys a roof over their head but does not share increases in value of the property they occupy. Furthermore, an owner-occupier typically enjoys non- financial benefits, including a sense of continuity and order in events (ontological security). In contrast, due to relatively weak legal protections in Australia and New Zealand, tenants often face ontological insecurity. These different experiences matter because owner-occupation is a normal aspiration, and has traditionally been privileged by government policies in property- owning democracies. Yet more than one-third of Australians and New Zealanders do not own the housing they occupy. Seeking to equalise housing experiences between tenants and owners is therefore an appropriate goal for government. In this article, the term ‘synthetic owner- occupation’ is used to describe a practicable, equalised housing experience for tenants relative to owner-occupiers, but ‘home’ has similar import.
Taxes can neutralise to some extent the different wealth experiences of tenants and owner- occupiers but, because these measures tend to level the circumstances of the majority downwards, they are politically implausible. While taxes cannot be effective alone, they may also contribute to closing the gap in consumption experiences of owner-occupiers and tenants. This article investigates, in particular, how taxes can supplement regulation in promoting an experience of home for tenants.