By The Guardian (World News) | Created at 2024-09-27 06:15:10 | Updated at 2024-09-30 11:42:06
3 days ago
Treasurer Jim Chalmers has conceded he did ask his department for information about possible changes to negative gearing and capital gains tax concessions, but the government insists any reform to the controversial tax breaks are not yet on the agenda.
The Independent senator David Pocock said the government had multiple options to make the system more equitable through moderate changes while still protecting investments made by ordinary families.
He suggested the government cut down the benefits for top earners, such as those with dozens of properties, and use the savings to fund more public housing.
“There are sensible ways forward, a sensible middle path to reform,” he said. “It’s not that we either scrap it or don’t touch it.”
The government has spent the week hosing down suggestions it was considering changes to negative gearing or capital gains tax concessions, after a report in the Nine newspapers revealed the Treasury had done modelling on possible options for reform.
Anthony Albanese on Wednesday appeared to argue the department may have done the modelling of its own accord, telling a press conference: “I’m sure the public service are looking at policy ideas … I want a public service that is full of ideas.”
Asked to confirm whether the government has asked Treasury for modelling, Albanese responded: “I didn’t confirm that.”
But in a press conference from China on Friday, Chalmers said he had gotten advice on potential reforms.
“When it comes to negative gearing changes, it is not unusual at all for governments or for treasurers to get advice on contentious issues which are in the public domain, including in the parliament. It is not unusual for treasurers to do that, but we have made it very clear through the course of this week that we have a broad and ambitious housing policy already, and those changes aren’t part of it,” he said.
“These changes which we get advice on from time to time because they’re in the public domain, or they’re in the parliament, they’re not part of our policy.”
Albanese repeated previous comments when asked about negative gearing reform on Friday.
“What we are doing is what we have before the parliament. So I talk about what we’re doing, not what we’re not doing. What we’re trying to do is get our legislation through in parliament as part of our $32bn Homes for Australia plan,” he said in a Melbourne press conference.
“I have said what we’re doing, and I have said what we’re not doing. What we’re doing is very clear, which is our Homes For Australia plan.”
But pressed several times by journalists, he did not repeat his more definitive response from Thursday, when he said Labor was not considering taking negative gearing reforms to the next election.
The deputy Liberal leader, Sussan Ley, claimed the government had been unclear on the issue, describing Labor’s position this week as a “shocker”.
Pocock and fellow independent Jacqui Lambie had earlier this year commissioned Parliamentary Budget Office research on five possible sets of changes to the two policies. In April it said some could net up to $60bn over a decade.
Speaking on Radio National on Friday, Pocock said the changes he thought “made the most sense” would be to grandfather existing negative gearing arrangements, limit new negative gearing to only one property, and allow the current capital gains tax discount for only new builds. The senator claimed that would boost supply by giving incentives to build new stock.
Albanese has said repeatedly the government was only interested in housing policies which would increase housing supply.
“You’re not throttling supply, you’re incentivising it. That would save $15 to $16bn over 10 years, that could be invested directly into social and affordable housing to deal with more supply, which we desperately need,” Pocock said.
He also pointed to statistics showing 70% of Australians who own investment properties only own one, to say that limiting negative gearing to a small number of properties would not harm the majority of investors.
Housing affordability group National Shelter said negative gearing reform would be a “good place to start” with addressing Australia’s housing crisis, but called for a broader discussion about tax reform and investment settings to fix the system.
