Anthony Albanese’s government is seriously considering changes to negative gearing and capital gains tax breaks.
Nine newspapers confirmed that the government has asked for modelling to be carried out on the possible shift to negative leverage, according to an unnamed Labour source.
Another Labour source confirmed that changes to negative leverage were being considered, but that Labour could still decide not to press ahead with any policy changes.
Negative gearing policies in Australia allow property investors to claim tax deductions when the costs of owning and maintaining their investment properties, such as loan interest and maintenance fees, exceed the rental income they earn from them.
This tax benefit can reduce the investor’s taxable income, potentially resulting in a lower tax bill.
Labor leader Bill Shorten’s plan to ditch negative leverage contributed to his loss of the “can’t lose” election to Scott Morrison in 2019.
When Albanese took over the reins of the Labor Party after that defeat, he said changes to negative leverage were out of the question.
But it could now be back on Labor’s agenda ahead of the federal election in May.
In interviews last week, Mr Albanese was repeatedly asked whether Labor would consider changes to negative leverage, and at no point did he rule it out.
“I don’t answer those kinds of questions,” he told ABC Radio National on Thursday.
But two days earlier, he had addressed a claim by the Property Council of Australia that switching to negative gearing would hurt housing supply.
Anthony Albanese’s government (pictured) is seriously considering a bold economic plan it previously rejected that will send shivers down the spine of Australian homeowners.
When Albanese took over the reins of the Labor Party after that defeat, he said changes to negative leverage were out of the question. File image
“That’s one of the reasons we’re very cautious about it,” he told ABC Radio Sydney.
Being “cautious” does not mean ruling something out, however, with one Labour official saying: “This is what Labour needs and wants – they need to fight for policies that show what they stand for.”
‘It is within the framework of values. That is why Albo was reluctant to rule it out the other day. Look at what Albo has said, he has not ruled it out.
“This will give the government something important and positive to talk about; it will be an important talking point in the campaign.”