Albanese keeps door open to negative gearing changes amid rumours of pre-election work

Negative gearing and capital gains tax changes are back on the agenda as Prime Minister Anthony Albanese weighs up taking the politically explosive policies to the next Federal Election.

In echoes of Labor’s rhetoric, before it ripped up the old stage three tax cuts, Mr Albanese said winding back the concessions “was not our policy” but would not explicitly rule out another backflip after revelations Treasury officials were examining potential changes.

Any move to overhaul the tax breaks would represent a major shift from the Albanese Government, which has resisted pressure from the Greens to resurrect the policies former Labor leader Bill Shorten took to the failed 2016 and 2019 elections.

It would also reset the Federal Election fight over housing, with the shadow treasurer Angus Taylor saying the Coalition wouldn’t support a “tax on housing”.

The Greens, which are refusing to pass the Federal Government’s supply-focused housing agenda unless it winds back negative gearing, seized on the reports as evidence Labor was “cracking under pressure”.

“Labor said it was impossible. Now they admit it’s possible. They must commit to doing it,” Greens leader Adam Bandt said.

Mr Albanese, Treasurer Jim Chalmers and a host of ministers were peppered with questions on Wednesday after Nine newspapers revealed Treasury had been asked to examine changes to negative gearing and capital gains tax concessions.

The options modelled include a cap on the number of properties an individual could negatively gear, the report said.

The Nightly confirmed Treasury has modelled some changes to the tax concessions.

But senior Government sources stressed it was just one of a range of ideas being examined as part of ongoing policy work.

Mr Albanese said he hadn’t requested the Treasury modelling and did not know if Dr Chalmers had.

But he played down the work, arguing it was routine business for the public service to examine policy ideas.

Asked to rule out negative gearing changes at a press conference on Wednesday morning, the Prime Minister attempted to shift focus to Labor’s $32 billion housing agenda, which includes the Help to Buy and Build to Rent schemes that are stalled in the Senate.

“What our Government is considering is fixing housing supply by getting our legislation through the Senate. That’s what we’re considering,” Mr Albanese said.

Questions about negative gearing derailed Treasurer Jim Chalmers’ press conference a few hours later in Brisbane, which he hoped would focus on figures showing monthly inflation had fallen to 2.7 per cent.

“We’ve got a housing policy and that (changes to negative gearing) is not in it,” he said in response to multiple questions on the topic.

Mr Albanese made a similar comment when asked on ABC Radio Sydney if negative gearing changes were back on the table.

“No, it’s not our policy,” he said.

Speaking later on Sydney’s 2GB, Mr Albanese said he had “no plans” to change negative gearing rules and had not discussed detailed proposals with “anyone”.

The comments are a statement of fact but leave open the possibility that changes could form part of Labor’s re-election platform.

Mr Albanese suggested that in order to move on negative gearing he would need to be sure changes would not “dampen” housing supply – a key concern from the property industry.

“And I don’t want to do anything that impacts the supply of housing,” he told 2GB.

Dr Chalmers said the Government’s housing agenda was focused on boosting supply, while its tax policies were limited to changes to the Petroleum Resource Rent Tax (PRRT), a doubling of the tax rate on large super balance and incentives for Build to Rent.

Labor has already backflipped on one major tax policy this term after it broke an election promise in January and reworked the stage three tax cuts in favour of middle to low-income workers.

At the time, Mr Albanese and Dr Chalmers – who for months insisted the Government’s position had “not changed” – said the broken promise was justified because the economic circumstances were different.

Dr Chalmers did not respond directly when asked if Labor would mount a similar argument to justify changes to negative gearing, instead repeating the Government was proud of its stage three tax cuts.

Scaling back the concessions would deliver a budget windfall, with Greens-commissioned Parliamentary Budget Office research estimating the tax breaks will cost the Commonwealth about $176 billion over 10 years.