Anthony Albanese has been grilled on future changes to negative gearing including capping the number of properties investors can buy and still get a tax break.
The Prime Minister was upbeat as Parliament resumed and the Liberals confirmed they will support the government’s legislation to ensure that “every taxpayer gets a tax cut.”
But during question time, the Liberal leader asked whether there were changes proposed to the family home or negative gearing.
Negative gearing occurs when the cost of owning a rental property outweighs the income it generates each year.
This creates a taxable loss, which can normally be offset against other income including your salary, to provide tax savings.
On the family home, the Prime Minister offered a clear denial on new taxes including death taxes.
“My question is to the Prime Minister: will the Prime Minister rule out changing the current tax treatment of the family home?,‘’ Mr Dutton asked.
“They’ve had two weeks to think about their first question. and it has nothing to do with what we’re doing,‘’ the Prime Minister replied.
“And something to do with something that no-one will ever do.”
But when the Liberal Deputy Leader Sussan Ley asked about negative gearing the Prime Minister’s answer was less than clear cut.
“Will the Prime Minister rule out any changes to the current tax treatment of negative gearing?,” he was asked.
But instead of ruling it out, the Prime Minister quoted a Liberal Senator, Maria Kovacic, who called for tax changes to boost home ownership including capping the number of properties investors could own and secure tax discounts.
“She said this, “we should not be afraid to consider tax changes whether they be capping…the number of properties that can be negatively geared”. That was in her first speech!,” Mr Albanese said
“And the Member for Menzies has this to say about negative gearing, “every lever must be on the table.”
“I tell you what we are doing about housing, we are focusing on supply. Focusing on supply.”
Treasurer Jim Chalmers was then asked if he was prepared to rule out tax changes for negative gearing.
“The Prime Minister, myself in press conferences, we have dealt with this question already,” he replied.
“Will he rule out changes to the tax treatment of negative gearing? He needs to give a clear and simple answer, a straight point on relevance, or he should sit down,” Liberal frontbencher Paul Fletcher said.
“I say this once again for those opposite. I’ve dealt with this question publicly and in the recent past, and the point that I make once again, Mr Speaker,” Mr Chalmers said.
“They want to ask us a question about all of the things that we haven’t said we’re doing because they can’t defend their position on the thing that we have said we’re doing.”
Last week, the Treasurer said “we’re not contemplating or considering resurrecting the policies that we took to the 2019 election.”
“Our focus when it comes to tax and housing has been on incentivising build to rent properties with the tax breaks that I budgeted for in the May Budget,” he said.