Budget estimates: NSW Premier Chris Minns says he won’t call for review in negative gearing

NSW Premier Chris Minns has waded in on the negative gearing debate, with some federal politicians calling for an overhaul into tax concessions for investors.

NSW Premier Chris Minns has ruled out calling for a review into negative gearing as a means to boost housing.

During budgets estimates on Wednesday, Mr Minns was grilled by Greens MP Abigail Boyd as to whether the government should seek to disincentivise investors from purchasing housing stock, citing $39bn of federal tax concessions that are “pumped into the private market”.

“The housing crisis was not just caused by a lack of supply. There have been a decade or more of poor policy decisions made by federal and state coalition governments,” she said.

“Are you going to send the message that something more than just building houses needs to be done?”

NSW Premier Chris Minns said negative gearing was a federal issue and ruled out calling for a review. Picture: NCA NewsWire / Nikki Short

However, Mr Minns said negative gearing was a federal issue, and maintained increasing supply was key to relieving the housing crisis.

“I often find that interventions from serving premiers are designed to evade responsibility or flip custody of a particular issue, and I don’t want to do that,” he said.

Negative gearing is a tax strategy that allows a property investor to buy a rental property using borrowed funds, and then deduct the losses to reduce their own personal income tax bill.

Capital gains tax is applied to profits from selling assets, such as property.

Mr Minns said he also would not resurrect the vendor duty or make additional changes to stamp duty or land tax, and said NSW could not solve its housing crisis by “taxing our way out of it”.

NSW Premier Chris Minns says increasing supply would help the housing problem, not taxing property owners. Picture: NCA NewsWire / David Swift

About $39bn every year is being pumped into the private market through federal tax concessions, including negative gearing and capital gains tax.

In February, former premier Dominic Perrottet told a Property Council of Australia event the issue should be put “on the table,” despite not advocating for it to be scrapped.

Ms Boyd’s questioning comes as the federal government faces pressure from the federal Greens party to overhaul negative gearing and capital gains tax in support for the Help to Buy scheme.

The four-year program would give 10,000 first-home buyers per year the ability to co-purchase a home with the government, which would contribute up to 40 per cent of the value of a new home, or 30 per cent of the value of an existing home.

However both Treasurer Jim Chalmers, and Prime Minister Anthony Albanese have maintained the changes were not part of their tax agenda.

‘Billions’: Huge claim on Sydney gang war

The illicit cannabis market is allowing Sydney’s criminal gangs to fund activities, including the gangland war, Legalise Cannabis Party MP Jeremy Buckingham has said.

During Wednesday’s grilling, Mr Buckingham said revenue generated by the black market cannabis sales “provides the resources to these crime gangs to begin.”

He also quoted statistics from the 2022-23 NSW Crime Commission Annual Report which said plants seized from large cannabis farms with more than 30,000 plants were worth “just under $500m”.

“Isn’t the prohibition on cannabis creating the business model for organised crime to generate billions to fund the war that’s exploding on our streets,” Mr Buckingham asked the Premier.

While Mr Minns said illegal cannabis sales is “is obviously part of the organised crime. commercial operations,” he said it wasn’t the “sole driver of economic activity for organised crime gangs”.

Legalise Cannabis Party MP Jeremy Buckingham said criminals were using profits from the sale of cannabis to fund their criminal operations. Picture: NCA NewsWire/ Dylan Coker

The Premier added there were also other criminal commercial activities which funded criminal groups.

“There’s other things that they pursue, for example, prescription medication, vaping, illicit cigarettes and other parts that wouldn’t be classified drugs,” he said. In June last year, NSW Police initiated Task Force Magnus to investigate a spate of five gangland shooting in just days.

At the time NSW Police Commissioner Karen Webb said she believed the shootings were likely motivated by the state’s illegal drug trade.

“The work that we do, day in day out, (finds) that what motivates violence and this city, is often drugs,” she said.

“When it comes to drug rips, territories, all sorts of things are motives for violent crime and there’s no place for it here.”

Future of Rosehill Racecourse mini city questioned

The future of a $5bn plan to turn Sydney’s Rosehill Racecourse into a major housing, metro and entertainment precinct has been thrown into question, after NSW Premier Chris Minns admitting approval would be dependent on a vote by members of the Australian Turf Club (ATC).

The plan, which was pitched to the state government by the ATC through an unsolicited proposal, were announced in December and could result in the creation of up to 25,000 homes.

As it stands, the government has also entered into a memorandum of understanding (MOU) with the ATC, who will retain the site.

However, on Wednesday, the Premier reiterated concerns that the plans could be overturned by members if they choose to vote down the proposal.

“We see it as a real opportunity for Rosehill racecourse, for the ATC, for racing in the state, as well as housing, but that decision will have to be decided by members of the ATC, not the NSW government,” he said.

NSW Premier Chris Minns said the transformation of Rosehill Racecourse was not in the government’s hands. Picture: NCA NewsWire / David Swift

Plans to turn Rosehill Racecourse into a new mini city will be dependent on approval from ATC members, and further negotiation between the Australian Turf Club and the NSW government. Picture: NCA NewsWire/ Monique Harmer

Even if members approve the plan, the final proposal would be dependent on further negotiations between the club and the government.

“There may well be, as part of the negotiations between the ATC and the government, irreconcilable differences particularly in relation to the disposal of property, the size of the rezoning, the density of housing, how much space is available …” he said, listing off several potential hurdles.

“That may be a deal breaker for one or both of those sides but in fairness to the government, we made that clear when the announcement was made.”

This signals a change in tone from the announcement of the plan, in which the Premier dubbed the proposal as a “once in a generation opportunity”.

“The government sees this as an opportunity to put its money where its mouth is and build more housing, close to transport links, with plenty of green space for new families,” he said at the time.

“This is exactly the type of proposal my government has been talking about over the last six months.”

Minns shoots down inquiry into waste industry 

As the state rushes to remove and contain tonnes of asbestos-contaminated mulch which was used at hundred of sites, the Premier has shot down initiating an inquiry into the waste industry.

As of Wednesday, both bonded and friable asbestos have been discovered at 47 sites across Sydney, including schools, hospitals, parks and garden beds.

However, Mr Minns said he was “reluctant” to launch an inquiry, and said the government should explore increasing penalties for perpetrators.

“I’d prefer action rather than an inquiry,” he said.

Minns defends rogue Pro-Palestinian MP 

Earlier in estimates, Mr Minns was interrogated as to why he has not “sacked” Upper House MP and NSW Parliamentary Secretary Anthony D’Adam.

The role, which is appointed by the Premier is given additional duties as well as an additional income of about $33,000 a year.

In December Mr D’Adams led a pro-Palestinian march in Sydney where he held a banner alongside another protester who was carrying a poster which showed Israeli Prime Minister Benjamin Netanyahu with a Hitler-style moustache, alongside the words: “child killer”.

While Mr Minns said he has publicly condemned Mr D’Adam’s comments as “inflammatory,” and “not the view of the executive government or myself or the NSW cabinet,” Mr Minns said sacking Mr D’Adams had the potential to “exacerbate community division”.

Labor Friends of Palestine mobilised for the Global Day of Action. We’re calling on all @AustralianLabor branches, MPs and Councillors to stand up for Gaza #CEASEFIRE_NOW@[e-mail]/CqVu8yrSlI

— Labor Friends of Palestine NSW (@labor_palestine) January 13, 2024

The Premier also said Mr D’Adam was not a member of cabinet and a “relatively junior member of the parliamentary Labor Party”.

“I think that this would be more divisive because it could well be the action sacking this individual could mean that a platform has been given to say even more commentary in the public domain in relation to this issue,” he said.

He also added that he was still concerned about community cohesion in relation to conflict in Gaza.

“I am concerned about community harmony in the weeks and months ahead. We’re not through the woods in relation to this, the conflict continues in the Middle East,” he said.

“We’ve got large communities across Sydney that are in some cases vehement opposition to one another.”

Asked if allowing Mr D’Adam to maintain his secretary role gave him “a license to say anything he likes,” Mr Minns strongly denied the claim.

“I’ve been clear and consistent in relation to both his public commentary and the situation involving that kind of commentary in the community, and the government’s position couldn’t be clearer, the cabinet’s because position couldn’t be clearer,” he said.

“It’s my strong belief that people need to speak with moderation in relation to this issue.”

Sacked minister’s future unclear

The Premier was also asked about the investigation by the Independent Commission Against Corruption (ICAC) into sacked minister Tim Crakanthorp.

In August, the Newcastle MP was removed from the portfolios of Skills, TAFE and Tertiary Education, and the Hunter after it was revealed he failed to disclose his family’s sizeable property holdings, which may have impacted his public duties.

Mr Crakanthorp was also referred to the ICAC, with the anti-corruption watchdog commencing a preliminary investigation in September last year.

Newcastle MP Tim Crakanthorp was sacked from him ministerial portfolios in August, 2023. Picture: NCA NewsWire / Nikki Short

However Mr Minns would not give an update on the investigation, or whether Mr Crakanthorp had been cleared of any wrong doing.

“I think you should leave it up to them to do their job,” he said.

“I’m not responsible for the timing of inquiries by that independent agency. And I think you should leave it up to them to do their job.“

Originally published as Budget estimates: NSW Premier Chris Minns says he won’t call for review in negative gearing