Negative gearing change to start on January 1 should Labor win the election

Labor would introduce its changes to negative gearing and capital gains tax by January 1 next year if it wins the May election.

The negative gearing reforms won't apply to newly-built homes and existing investment properties, while the capital gains tax discount will be halved for investments entered into after January 1.

Shadow treasurer Chris Bowen said the property tax changes would raise $2.9 billion over the forward estimates, and save the budget $32 billion over a decade.

"If you already use negative gearing, nothing changes. It's not retrospective. And you can still use it for new houses," he said in a statement on Friday.

"Federal Labor's plan is good for the budget, good for housing construction jobs and fair for first home buyers."

Labor took the negative gearing policy to the 2016 election and has resisted pressure to scale back the changes amid a downturn in the Australian property market.

The Morrison government plans to make the policy a focus of the federal election, which is expected to be called in less than two weeks.

Labor on Friday also announced it would cut the managed investment trust withholding rate in half, from 30 per cent to 15 per cent, to encourage new housing.

The Property Council of Australia said it remains strongly opposed to the tax overhaul.

"And deeply concerned with its potential impacts on housing markets and the broader economy at this uncertain time in the cycle," the group said in a statement.

"In particular, we are concerned with the impact of these tax changes on new housing construction."

A recent survey commissioned by the Property Council found the policy won't stimulate new housing construction as hoped.

Labor's plans to increase capital gains tax and limit negative gearing will hit the nation's wealthiest and largely Liberal-held electorates, sparing those in low income rural areas or comfortably held by the ALP.

A special breakdown of Tax Office data covering average negative gearing losses and the average capital gains discount enjoyed by taxpayers shows Labor's policies will hit hardest voters in areas least likely to back the ALP at this year's election.