Government commissions Treasury to model changes to investment property taxes, sparking speculation.
While dismissing immediate changes to negative gearing, the government remains open to policy adjustments, stating they “keep looking at all policy options all the time.”
Rumors of potential changes escalated after reports suggested the Treasury had been tasked with exploring alterations to tax arrangements for investment properties.
When questioned about Labor’s housing policy measures, Treasurer Jim Chalmers avoided specifics, emphasizing their focus on building more houses for Australians.
Prime Minister Anthony Albanese echoed similar sentiments, emphasizing the value of advice from the public service department.
Both Chalmers and Albanese declined to confirm or rule out changes to negative gearing or capital gains tax exemptions, highlighting their commitment to passing existing legislation, such as the Help to Buy Bill.
While not explicitly confirming the commissioning of Treasury for advice, Albanese emphasized the importance of a public service full of innovative ideas.
Chalmers outlined the government’s tax priorities, including adjustments to the Petroleum Resource Rent Tax (PRRT), addressing significant balances in superannuation, and introducing tax incentives for build-to-rent developments.
What is Negative Gearing?
Negative gearing is an investment strategy prevalent in Australian real estate, where the costs of owning an investment property exceed the income it generates. Investors can claim the loss as a tax deduction, aiming for long-term profitability through property appreciation despite initial losses.
Debates surrounding negative gearing focus on its impact on property prices and its perceived benefits for wealthier investors versus its role in encouraging investment and increasing rental supply in the housing market.
