This article is from the Australian Property Journal archive
PRIME Minister Anthony Albanese has declined to rule out Labor pushing for changes to negative gearing – a policy it took to the doomed 2016 and 2019 federal elections – thrusting housing further into the national political spotlight.
Nine newspapers yesterday reported that the government had tapped Treasury advice for potential changes to the controversial arrangement. Negative gearing ultimately amounts to billions of dollars in tax benefits each year for property investors, who can deduct losses copped on investment properties.
The Opposition has said it would oppose any changes, while the Greens have called for end to the tax breaks altogether, saying they contribute to the national housing crisis.
The Greens and Opposition have teamed up multiple times in the past year to halt or delay the passage of Labor government housing policies through Parliament – mostly recently on the Help to Buy legislation in the Senate, prompting Albanese to threaten a double dissolution election.
Labor’s possible negative gearing policy could see grandfathering of the changes, as it did in 2016 and 2019, meaning properties negatively geared currently would not be impacted. At both of those elections it also put forward halving the capital gains discount for those who had owned an asset for more than a year.
“Treasury, I’m sure, like other departments, do a range of proposals, policy ideas. I want a public service that is full of ideas,” Albanese told a media conference in Launceston yesterday when pressed on the Nine reports.
“What we do is we value the public service. So from time to time, I’m sure the public service are looking at policy ideas.”
He deflected towards government policies aiming to increase supply at a time of a national housing crisis.
“What our government is considering is fixing housing supply by getting our legislation through the Senate. That’s what we’re considering.
“What we’re doing is doing the legislation that we have before the Senate. So, I talk about what we’re doing, not what we’re not doing. And what we’re doing, is trying to get through that legislation through the Senate.”
A spokesperson for Treasurer Jim Chalmers asked about negative gearing policy said yesterday, “Our housing policy is clear. It doesn’t include that change”.
“We have a broad and ambitious housing agenda and we could be building more homes if it wasn’t for the divisive politics of the Greens and Coalition.”
Coalition finance spokesperson Jane Hume told ABC’s News Breakfast the Coalition would oppose any changes that would reduce housing supply and push up rents.
She said that removing the tax incentives would see “investors leave the system so that we have fewer rental properties”.
“And those that stay in the system push their rents up so that they can compensate for the loss of that tax incentive.”
Greens Leader Adam Bandt said the “unfair tax handouts are driving the rental and housing crisis”.
“They help wealthy property investors buying their seventh property and hurt renters trying to buy their first home.
“Labor needs to stop tinkering around the edges and instead work with the Greens to fix the broken housing system. Changing these unfair tax handouts is the kind of reform that could start to fix the housing crisis and see Labor’s weak housing legislation pass the Senate.”
