Liberal Senator Jane Hume: “Who is commissioning this secret plan? Is it the Prime Minister along with Jim Chalmers and Katy Gallagher?” (pictured). Photo: Jim Chalmers Instagram.
Changes to negative gearing laws are once again back on the agenda as a distinct possibility as the Federal Government searches for answers to the worsening housing crisis across the country.
Anthony Albanese initially refused to rule it out this week, instead saying the public service was looking at “all policy ideas” the government would value.
That includes reducing housing tax concessions.
“Treasury, I’m sure, like other departments, do a range of proposals, policy ideas,” the Prime Minister said when asked if his government was looking at negative gearing.
“I want a public service that is full of ideas.
“I’m sure the public service is looking at policy ideas. That’s because we value them. But we have our housing policy. It’s out there for all to see.”
The comments have added fuel to reports the government has commissioned Treasury modelling on changing tax benefits for the owners of investment properties.
“What our government is considering is fixing housing supply by getting our legislation through the Senate,” the PM added.
“That’s what we’re considering.”
Labor’s housing bills have stalled in the Senate, with the rejection of its Help to Buy legislation shaping up to offer the government a trigger for a double dissolution election.
However, it’s the Prime Minister’s remarks about negative gearing that have caused alarm in some quarters, even though he said in subsequent interviews that the government had no plans to tamper with the tax concessions.
They are particularly curious because Labor took a policy to the 2019 election to change negative gearing.
Labor lost that election and as recently as this month has suggested such a policy won’t be revisited.
The Opposition says winding back on tax concessions for investment properties would reduce supply and push up rents.
Shadow finance minister Jane Hume said the Coalition would likely push back against the move.
She also said the PM should be upfront about his intentions regarding the issue.
“There’s nothing wrong with the government considering anything, but lying to the Australian people about whether they’re considering it is another issue entirely,” she said.
“The question is, of course, who is commissioning this secret plan? Is it the Prime Minister along with Jim Chalmers and Katy Gallagher? Are they doing it in conjunction with the Housing Minister, Clare O’Neil? Are they letting their Cabinet know? Because this is the first that we’ve heard about it.
“The Coalition did look at this policy back in 2019 when the then Shorten-led Labor Opposition had a policy around negative gearing.
“The problem, of course, is that negative gearing, when you remove those tax incentives for investors in property, two things happen: one is 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.
“Now, at a time when we’ve got a rental crisis, that’s a real problem.”
Senator Hume dodged questions about whether the Coalition would rule out taking a policy of its own to the next federal election to change negative gearing.
“I’m very interested to see exactly whether the government’s ruling out changes,” she said during an ABC interview.
“We will rule out anything that reduces housing supply and that pushes rents up in the middle of a housing crisis.
“I want to know what the government are proposing because, quite frankly, they should rule out changes to negative gearing.
“We rule out anything that reduces supply, we rule out anything that pushes up rents and if … the government has this secret plan to change negative gearing does that, well, then we will oppose it.”
When pressed further to specifically rule out changes to negative gearing, Senator Hume responded: “I can’t rule out a policy that I haven’t seen. This is the government’s policy … they need to come clean on what their policy is so that we can have a look at it.
“But at the moment, all we’re hearing about is a policy that is going to push up rents and that is going to limit housing supply. That’s not good policy.”
Treasurer Jim Chalmers has downplayed suggestions the government is preparing to make a move on negative gearing tax laws.
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