Liberals go on the attack over Labor’s ‘housing tax’

The Liberal Party has launched its campaign in Adelaide with a warning Labor’s property policies could ‘trigger a recession’.

Retiring member for Sturt Christopher Pyne. Picture: AAP

The Liberal Party has launched its campaign in Christopher Pyne’s South Australian seat of Sturt with a warning that Labor’s property policies may “trigger a recession”.

Just days after James Stevens was preselected as the Liberal candidate to replace the retiring Mr Pyne at the upcoming federal election, every household in the affluent suburban Adelaide electorate received a flyer and a letter from Mr Pyne.

Voters were told Labor’s plan to abolish negative gearing and halve capital gains tax concessions would reduce house prices and increase rent.

Sturt was the first South Australian electorate in the state to receive the material but it is understood the strategy will be rolled out in other key seats such as Boothby, Mayo and Adelaide.

The campaign comes as Labor’s Treasury spokesman Chris Bowen confirmed on ­Friday that his party’s property reforms would begin next January 1. An estimated 1.3 million Australians take advantage of the current negative gearing policy and a series of studies have found its removal would slow building activity and cost jobs.

Mr Pyne told voters Labor could not be trusted to oversee the economy and “when Labor runs out of money, they end up coming after yours”. “With the housing market ­already cooling, now is the worst possible time for Labor’s housing tax,” the ­Defence Minister said.

The most recent Australian Bureau of Statistics data showed Adelaide and Hobart were the only two capital cities to record an increase in house values in the December quarter.

Mr Stevens, a moderate who comfortably won preselection over two conservative female candidates, said Labor’s proposed changes would hurt Sturt more than most electorates because of its demographics. “There’s a huge proportion of people who are homeowners and everyone is going to be affected,” he said. “It’s not about the people who negatively gear, although there’s lots of them … any homeowner is going to be affected by a general reduction in prices.”

The Liberals hold Sturt, which takes in much of Adelaide’s eastern suburbs, by a ­notional 5.4 per cent.

Labor’s candidate for Sturt, Cressida O’Hanlon, did not ­return The Australian’s calls.