— Warning: The following contains high levels of irony and schadenfreude —

The mining lobby, representing the big miners like Santos, Rio and BHP, had a cunning plan.

They called for environmental groups to lose their tax-deductable status in a submission to a parliamentary inquiry.

It must have seemed like a good idea at the time. All those pesky environmental organisations getting tax deductable donations! Oh weep for the poor taxpayers! They lose $18 million because of key environmental groups’ tax deductibility according to the NSW Minerals Council (forget the mining company’s habit of off-shoring their profits and avoiding billions in tax).

The Australia Institute thought there was more to the story.

Our submission to the inquiry challenged the mining lobby’s numbers, and also pointed out that the funding of groups like the Minerals Council comes from mining companies – and those ‘fees’ are… wait for it… tax deductable!

So how much does the taxpayer lose out on tax deductions to pay for big mining lobbyists? $20 million a year! Media coverage, including lots of chatter on social media, got the irony.

• Negative gearing loses ‘sacred cow’ status
• The #endofcoal
• Divestment movement gaining support
• TAI in the Media

Negative gearing loses ‘sacred cow’ status

Negative gearing has long been a sacred cow in Australian politics. It was untouchable. Why?The two main reasons given were that it keeps rents down and the benefits flowed widely to ‘mum and dad’ investors.

On rents, Joe Hockey claims: “There is a very strong argument that if you were to abolish negative gearing, you would see a significant increase in rent.”

Which strong argument is he talking about? His is the tale of two cities, Sydney and Perth, in the 1980s when negative gearing was briefly scrapped and rents in those cities did indeed go up.

However, there were other cities in Australia back in the 80s, and they kept data on rental prices too. Low and behold, rents were stable or even went down elsewhere.

For more details, check out TAI’s Facts Fight Back on Negative Gearing. Alternatively, listen to Emma Alberici put these facts to Finance Minister, Mathias Cormann on Lateline.

But what about ‘mum and dad’ investors?

Our paper, Top gears, looked at the benefit of negative gearing, in dollar terms. It showed that while a number of ‘mum and dad’ investors might be involved in negatively gearing a rental property, over half the tax benefits go to the richest 20 per cent of households. The idea that the benefits flow mainly to average Australian households is not born out by the facts.

The research also highlights that the combination of negative gearing and the capital gains tax discount makes housing less affordable. This is the issue that has lit up the media with news stories and articles connecting negative gearing and housing affordability.

The issue has gained so much momentum that the Labor Party is now looking at making changes to restrict negative gearing and the Greens have a costed policy to wind back the tax break. This is a huge shift in such a short period of time. The idea that one of the two big political parties would take on negative gearing was unthinkable even 12 months ago.

The #endofcoal

Four Corners may have sounded the gong on Monday night with their program The End of Coal?For years we have argued not just that coal would end, but that the big miners have over-hyped their industry well before the end. We fought and won two court cases over whether the economics of Hunter coal projects stacked up – they didn’t. Earlier this year we were in court against the Adani coal project in Queensland – we don’t think it stacks up either.

But the big issue is not whether or even when coal will end, but how we plan for it. Planning departments in our coal regions don’t seem to want to face this as acknowledging the need for a plan would acknowledge the end of coal, which is definitely against government policy in NSW and Queensland.

Divestment movement gaining support

The global fossil fuel divestment movement is growing so quickly that Australia’s universities are at risk of being left behind. The last few months have seen announcements from Oxford, Edinburgh and it looks like MIT might soon follow. There are now around 35 unis with some divestment commitment (depending on what you allow on your list).

The really big news was Norway’s $900 billion sovereign wealth fund, based on oil money, now divesting from coal extraction and burning. In Australia, the Royal Australasian College of Physicians has agreed to dump fossil fuel companies.

Australian unis are wary, after the mining lobby and its mates in government attacked the ANU’s divestment decision last year. Our vice chancellors should realise that ethical investment decisions on fossil fuels have the support of most of the public, as emphasised in our recent report, Leading by Degrees which finds:

• Most Australians agree universities should avoid fossil fuel investments.
• Support is highest among younger people and those who accept that humans are changing the climate.
• Most alumni say they would be more likely to donate to their university if it divests.
• Many say university decisions influence their personal investment choices, such as superannuation.

Universities should not sit idly by and watch the divestment debate unfold. They should think deeply about their role in leading the community – divestment is a powerful option for forward thinking institutions.

TAI in the media

New Matilda: Inquiry Targeting Green Groups Accidentally Exposes $145 Million Mining Tax Dodge

Guardian: Deductions for mining company lobbying cost taxpayers $20m a year

Australian Financial Review: Abbott blind to coal’s decline

Sydney Morning Herald: Planning for coal ignores prospect of declining global demand

Herald Sun: Every weekend should be a long weekend

The Australian (Business Insider): The Budget Office revealed Australia would be $42.5 billion better off by scrapping negative gearing

The Age: Federal budget hangover? Peter Costello’s to blame

Property Observer: Property market facts are stubborn things