Anthony Albanese hasn’t used tax break ‘since he was Prime Minister’
It’s something most Aussie property investors love, now Anthony Albanese has come clean on whether he’s used negative gearing.
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Anthony Albanese has hinted he used negative gearing before he became Prime Minister to reduce his income tax but ruled out using it for his $4 million Copacabana holiday house.
The Prime Minister’s office has declined in the past to reveal if Mr Albanese is negatively gearing any of his investment properties.
It’s unclear why he is reluctant, given that it is entirely legal.
But now after the PM was put on the spot twice in the last week, he’s now delivered a carefully worded answer insisting that he hasn’t used negative gearing “since he became Prime Minister”.
Mr Albanese earns $607,500 a year as Prime Minister. In simple terms that means he pays $244,042 a year in tax.
Mr Albanese also earns around $115,000-a-year in rental income he is pulling in on top of his salary as Prime Minister, although his mortgage bill is unknown.
If he was making a loss on one or more of his investment properties, he could legally use that to reduce his taxable income with his accountant.
Negative gearing and first home buyers
Negative gearing is a commonly used term used to describe a situation where expenses associated with an asset such as an investment property (including interest expenses) are greater than the income earned from the asset.
It can apply to any type of investment, not just housing. Individuals who are negatively geared can deduct their loss against other income, such as salary and wages and it’s entirely legal.
Critics argue that negative gearing hurts first home buyers because they don’t have access to tax deductibility to subsidise interest payments.
Without a windfall on the sale of another property they may have difficulty accumulating a deposit.
As a result, negative gearing can encourage people to borrow more than they otherwise would and adds fuel to booms in asset prices.
PM’s swipe at Peter Dutton
Asked if he was negatively gearing his Copacabana holiday house on Friday by news.com.au, Mr Albanese instead took aim at Peter Dutton, suggesting he owned more property than the PM.
“Seriously. I will swap my property portfolio with Peter’s,” he said.
According to his current disclosures to Parliament, Mr Dutton currently owns only a single property, a farm in Dayboro just north of Brisbane that he bought for $2.165m in 2020.
In recent years, Mr Dutton has offloaded around $12m in real estate holdings and appears to have stashed the cash in a family trust.
MORE: Huge prediction for Aussie house prices
PM’s carefully chosen words
But when pressed again on if he was negatively gearing at Copacabana in Adelaide last week, Mr Albanese used an interesting set of words.
“I have not used any negative gearing while I have been Prime Minister,” he said.
In other words, he did not deny using it in the past.
Now Mr Albanese has doubled down using the same careful formulation with broadcaster Neil Mitchell when asked if was using negative gearing on his $4m holiday home.
“You’re a landlord, of course, did you negatively gear your property?,” Mitchell asked.
“No,” Mr Albanese replied.
“No? Paid cash?,” Mitchell said.
“No,” Mr Albanese replied.
“So you’re just not claiming?,” Mitchell said.
“No. I don’t want to go through all of my finances on air,” Mr Albanese said.
“But negative gearing is the important one, because there’s been a lot of criticism in the Labor Party,” Mitchell said in response.
Mr Albanese then used the same set of words he did in Adelaide.
“I’ve not used negative gearing at any time that I’ve been Prime Minister,” Mr Albanese said.
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Negative gearing controversy
It’s not clear why the Prime Minister is reluctant to reveal whether he’s used negative gearing given that it is completely legal.
But it could be that he’s concerned the Greens, who oppose negative gearing, will suggest he won’t change the rules because he benefits from it.
“As a principle, I think there’s nothing wrong with people being engaged in negative gearing. Let’s be very clear,” Mr Albanese said.
“Everyone is the same within the law, and if people want to engage in these things, just the same as Peter Dutton, portfolio is a lot bigger than mine. And good morning. The difference is I don’t have mine, behind a trust, but good on it. Mica is entitled to do whatever.
“Negative gearing, all of the evidence is, that it doesn’t have an impact on supply,” Mr Albanese replied.
“And if you, if you immediately change negative gearing, it could actually have a negative consequence on people investing.
“We have no plans to do anything on negative gearing, because we don’t think that is the main issue. The issue is supply, and that’s what we’re tackling.”
Landlord Anthony Albanese
Mr Albanese also earns around $115,000-a-year in rental income he is pulling in on top of his salary as Prime Minister.
Greens housing spokesman Max Chandler-Mather has taken aim at Mr Albanese for owning investment properties as he stepped up his campaign to scrap negative gearing laws.
After growing up in public housing, the Prime Minister is now renting out two Sydney homes including a mortgage-free federation bungalow with a pool while he lives rent-free at the Lodge.
“Let’s be real, if Labor wants to deal with housing affordability then it’s time to phase out the billions of dollars in tax concessions property investors get every year in the form of negative gearing and capital gains tax concessions,” Mr Chandler-Mather said.
He went on to question why Australia has a “property investor as a prime minister” during the “worst housing crisis we’ve seen in a generation”, accusing Mr Albanese of fighting to protect negative gearing and capital gains tax concessions.
In recent years, Mr Albanese made a tidy $500,000 profit after offloading his two-bedroom Canberra ‘bachelor pad’ (bedroom above). He bought the property 23 years ago for $162,000.
He also rents out a second property in Dulwich Hill for $880 a week. That property does have a mortgage with the Commonwealth Bank.
He purchased the investment rental property in Dulwich Hill for $1.175m in 2015. It’s now worth between $1.6 and $1.9m.
Before his divorce, Mr Albanese also owned a fourth property in Marrickville which he sold for $2.25m in July 2021.
The Prime Minister amassed a property portfolio worth around $5m before he offloaded several properties to take his holdings down to around $4m last year.
He lives rent-free at the Prime Minister’s official residence The Lodge in Canberra where he has access to personal staff to clean and cook and can also sleep at Kirribilli House when in Sydney.
Mr Albanese’s climb up the property ladder began in 1990 when he bought his first home in Marrickville for $146,000.
Questions over Peter Dutton’s share-dealing
Labor has also raised questions over Mr Dutton’s share-trading during crucial junctures of the global financial crisis.
As the Prime Minister prepares to call an election, a forensic analysis of Mr Dutton’s declarations to parliament reveals he notified parliament of a share-buying blitz involving the big banks the day before Labor announced a bailout in 2009.
Asked if Labor was “accusing Mr Dutton of insider trading” on Tuesday, Mr Albanese said these were questions for the Liberal leader.
“That’s a matter for Peter Dutton to explain,” he said.
In response, Mr Dutton accused Labor of muckraking.
“If the Albanese Government’s dirt unit spent more time being focused on fixing Labor’s cost of living crisis rather than obsessing about Peter Dutton, Australians might be better off,” a spokesman said.
“All updates to Mr Dutton’s register of interests were made at the appropriate time.”
Labor frontbencher Murray Watt said Peter Dutton had questions to answer.
“What shares did he buy? Exactly when did he buy them? How much profit did he make on these share-trading deals? What access did he have to sensitive information?
“How else does he explain his sudden interest in share-trading in the banks the day before a massive bank bailout was announced.
“I am asking Peter Dutton some serious questions.”
Originally published as Anthony Albanese hasn’t used tax break ‘since he was Prime Minister’
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