Anthony Albanese appears to leave door open on negative gearing reform

Prime Minister Anthony Albanese appeared to refuse to rule out changes to a tax benefit following reports modelling is being undertaken on reform.

Anthony Albanese has appeared to leave the door open on changing negative gearing tax benefits for people with investment properties following reports Treasury was tasked with producing modelling on potential policy changes.

Asked whether he would rule out negative gearing as an election policy on Wednesday, the Prime Minister appeared to not explicitly rule out future reform.

“What we’re doing is 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,” he said.

Prime Minister Anthony Albanese refused to explicitly rule out changes to negative gearing. Picture: NewsWire/ Martin Ollman

Mr Albanese’s comments appeared to conflict with what Social Services Minister Amanda Rishworth said earlier on Wednesday.

Asked about negative gearing, she said: “It is not our proposal to address or to add negative gearing to that.”

Nine newspapers on Wednesday reported that Treasury had been asked to undertake modelling on potential policy options.

This included options canvassing limiting the number of properties that would use the benefit or only allowing the concession to be applied on new properties.

Speaking to media in Launceston, Mr Albanese said he personally had not requested modelling from Treasury but said it was possible it came from other departments.

“Treasury … like other departments, do a range of proposals, policy ideas. I want a public service that is full of ideas,” he said.

He also reiterated his previous points that Labor was focused on its shared equity Help to Buy scheme and Build to Rent, which gives tax concessions to developers to build rent-only housing.

Both schemes remain blocked in the Senate, where the Greens are refusing support.

The minor party says it would be willing to negotiate if the government concedes on its stance on negative gearing and capital gains tax or commits to extra housing.

Facing a grilling on negative gearing in a separate press conference, Treasurer Jim Chalmers said he would not “engage in hypothetical impacts of hypothetical policies”.

Asked if either he or Finance Minister Katy Gallagher had asked Treasury to do the modelling, he said it was “not unusual for us to get advice from departments on issues that are being speculated about in the public or in the parliament”.

He appeared coy when quizzed on whether he would definitively ‘rule out’ negative gearing as a policy platform. Picture: NewsWire/ Monique Harmer

Greens housing spokesman Max Chandler-Mather said Mr Albanese’s comments showed Labor was “cracking under pressure from the party of renters”.

“After pretending it was impossible, all of a sudden under pressure from the Greens, millions of renters finally have some hope, as Labor is actively considering changes to negative gearing and CGT,” he said.

“If Labor gets this right it could be light at the end of the tunnel for millions of renters who are losing hope they’ll ever be able to buy a home.”

In 2016 and 2019, Labor unsuccessfully attempted to woo voters with negative gearing and capital gains tax reform, dumping both policies in 2021.

At the time, the Coalition seized on the policy platform and claimed it would be a retiree tax for older Australians.

However, according to recent polling commissioned by Everybody’s Home and undertaken by RedBridge polling group, nearly half (46 per cent) of 2000 respondents supported a policy limiting negative gearing to one property, with one in five respondents opposing the measure.

Negative gearing, in which the cost of owning an investment property outstrips its rental yield, allows someone to deduct the loss from their tax return, with about 1.1m Australians using the tax benefit in the 2021-22 financial year.

Australian residents can also get a 50 per cent capital gains tax on an investment home if they’ve owned the asset for at least 12 months.

The tax is not applied on the sale of a primary home.

In response to Mr Albanese’s comments, Liberal MP Zoe McKenzie said there needed to be clarity from the government.

She also dismissed a “modest” approach, which limited negative gearing to three properties and grandfathered current homes, stating it would do little to boost supply.

“We have to remember that the negative gearing mechanisms are actually a way for people to get into their own home,” she said.

“Many young people I know stick it out, rent cheap for as long as they can but buy, negative gear and just put away money every month trying to make that place a home where they can afford to live in.”

Originally published as Anthony Albanese appears to leave door open on negative gearing reform