Prime Minister Anthony Albanese has ruled out changes to negative gearing, saying tinkering with the tax concession could harm housing supply.
Negative gearing allows investors to write off their property losses against other income, reducing their overall tax bill.
Treasury is reportedly modelling the impact of policy changes, but Albanese was more definite on Thursday when asked if Labor would include negative gearing reform in a tax package for the upcoming federal election.
“No, we’re not,” he told ABC TV.
Changes could include capping how many properties can be negatively geared or scrapping it completely while grandfathering it (meaning arrangements won’t change for those who already use it).
Limiting it to new builds is another suggestion. Supporters say the idea would likely encourage investment in new homes to boost housing supply and, in turn, put downward pressure on rents.
But Albanese said he couldn’t see the positives in negative gearing changes, with experts warning it would sap investment from the sector and not increase supply – which remained his government’s focus.
“The problem is all of the analysis shows that a change to negative gearing will not assist supply,” he told Sky News.
The opposition has ruled out any changes to negative gearing, with housing spokesman Michael Sukkar and shadow treasurer Angus Taylor talking down the effectiveness of the idea.
Sukkar said housing was taxed enough. He also ruled out supporting a cap on how many houses the concession could apply to.
The majority of people who negatively geared property had only a single investment, he said.
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