James Campbell: Bill Shorten’s election losses won’t stop Anthony Albanese from targeting negative gearing
If you thought Labor election losses in 2016 and 2019 would give Anthony Albanese pause from going after negative gearning think again — there are plenty in his government who view the issue as a vote winner.
Opinion
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For months it has been clear the government needs to do something not just to make a difference to the housing crisis but also to look like it has a purpose.
Now, according to a report in the Nine papers, that ‘something’ looks like winding back negative gearing and the capital gains tax breaks for rental property.
On Wednesday morning Anthony Albanese was asked if the government has sought advice from the Treasury on potential change.
“I have seen those reports,” the Prime Minister said.
“And what we do is we value the public service.”
Not exactly hosing it down is he?
This is the second time in a fortnight he has conspicuously failed to end speculation about negative gearing.
It’s starting to feel a bit like the non-denials we got in lead up to the announcement of changes to the Stage 3 tax cuts.
On one hand you can see why the government is looking at revisiting this.
Pollsters say the view that this is a do nothing government is hardening out there in voter land.
And ‘doing something’ about negative gearing has become a progressive shibboleth.
In other words the government needs something to argue for with the public, something that they actually believe in and which their party members actually want.
Against that it won’t have escaped Labor ministers’ attention that they’ve been here before and it hasn’t ended well.
At both the 2016 and 2019 elections it promised to limit negative gearing to new properties only and to halve the 50 per cent capital gains tax deduction.
It goes without saying of course that on these occasions the Australian Labor Party was not successful.
To understand why the idea hasn’t gone away you need to understand that although they’ve lost twice with this policy, Labor people don’t think it was the reason why they lost.
In 2016, despite promising to roll back negative gearing, they still came within an inch of winning, while the 2019 defeat they reckon had far more to do with the franking credits policy.
In other words while you might think this is a perfect example of a burnt fool’s bandaged finger going wobbling back to the fire, there are plenty in Labor who still think Australians can be brought to accept these changes.
The reasoning seems to be that while around 1.1 million people currently access negative gearing, their votes won’t be in jeopardy because grandfathering will mean they won’t be affected.
Labor strategists will also be aware that concerns about the cost of housing in Australia are not confined to the young who are locked out of the property market.
Parents too – some of whom probably negatively gear – are also angry on behalf of their kids.
Then there’s the money Treasury will be telling them will roll in if tax losses on rental property can no longer be deducted against tax due from other income.
Labor could of course use these ‘savings’ to cut income tax rates.
I just raise it as an idea. We all know that’s not going to happen.
Far more likely is that Labor will use the money it hopes to gain to pay for its plans to expand subsidised child care.
More curious than Labor’s desire to end negative gearing — which is an eternal dream — is why it is prepared to run the risk of allowing the Greens Party to claim credit for any change it offers.
By refusing last week to deal with them over his housing bill which is stuck in the Senate, Albo couldn’t have been clearer that he was not prepared to let it look like the Greens are dictating Labor’s housing policy.
But if he isn’t careful about how he handles any change he is planning here, that is exactly what this is going to look like.
And that would be a political disaster.
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