How much more you will pay if negative gearing, CGT concessions are cut

Treasurer Jim Chalmers has yet to rule out big changes to negative gearing and capital gains taxes in a bid to repair the budget.

An average Aussie with a negatively geared property would fork out another $2700 a year in tax, while someone selling a rental property would pay an average of $7500 more tax on the sale, if capital gains and negative gearing were targeted in a bid to repair the budget.

While Prime Minister Anthony Albanese ruled out scrapping capital gains concessions on the family home, he and Treasurer Jim Chalmers have yet to definitely rule out turning the Razor Gang on to broader capital gains discounts and negative gearing.

Treasurer Jim Chalmers. Picture: NCA NewsWire / Martin Ollman

Mr Chalmers said he had “no intention” of reheating election policies from Labor’s disastrous 2019 election, but left wiggle room for future developments.

But Opposition treasury spokesman Angus Taylor said the Labor’s “2019 big taxing agenda is back”

It follows the government’s backflip on superannuation, after it announced plans to double the tax rate on balances over $3 million.

The Federal Government also released a tax expenditure statement released on Tuesday which showed $150 billion in revenue was being lost in tax concessions.

It showed there were about 1.3 million Australians who claimed $3.6 billion in negative gearing tax benefits.

Averaging out the benefits across the number of people who claimed it gives a rough estimate of $2770 per investor claiming it.

Similarly, in 2019-20 there were 610,000 Australians who claimed the 50 per cent capital gains tax discount on selling an asset they held for at least 12 months, with the government foregoing $9.24 billion in revenue from this.

If the discount was halved, as proposed by Labor in 2019, those investors would have paid an additional $7500 tax that year on average.

Mr Chalmers reiterated on Wednesday that the tax expenditure statement was about transparency and not a “statement of intent”.

Opposition treasury spokesman Angus Taylor. Picture: Martin Ollman/Getty Images

“I don’t want to get into the practice of coming before you each day and working through hundreds of billions of dollars of tax concessions and playing the same rule-in, rule-out game,” he said.

Pressed on whether more concessions than just superannuation would be targeted in the future, he said: “we’re not saying today that we want to change those tax concessions”.

“We don’t intend to reheat the policies of the 2019 election, we’ve made that really clear,” Mr Chalmers said.

Mr Taylor said the government’s tax statement laid out “a smorgasbord of options for taxes”.

“Make no mistake about it. Labor’s 2019 big taxing agenda is back,” he said.

“The one thing we know about their tax promise is they haven’t kept them in the past and we’ve seen that with superannuation taxes.”

Originally published as How much more you will pay if negative gearing, CGT concessions are cut