Thanks for clarifying, I appreciate it. 
It was a poor example. It's obvious I'm no tax lawyer. I was thinking of the renters tax deduction/rebate in the context of a flow chart. Going from government through the renter's pocket to the landlord's pocket.
 I maybe should of just noted the unfairness of the capital gains tax rate compared to wages, second home mortgage deductions, carried interest special tax treatment, tax break for offshoring jobs, charitable deductions are better for higher income brackets, etc.
Once again thanks. I learned something from your correction.