“Is the prime minister being relevant?” the opposition appealed to the House Speaker, as Prime Minister Anthony Albanese managed to avoid answering questions on negative gearing on the first day of Parliament this year.
Negative gearing refers to the ability of a landlord to claim any loss that occurs—when the cost of owning a rental property outweighs the income it generates—against their other income, including wages or salary.
Some Labor MPs, and the left-wing Greens, support limits on negative gearing, claiming it would improve housing affordability.
As Parliament resumed, the Liberal-National Coalition tried its best to compel the prime minister to admit that negative gearing might be capped, but Mr. Albanese instead, focused on the divisions within the Coalition and its decision to back the government’s changes to the tax cuts.
Senator, MP, at Odds With Dutton: PM
Liberal Senator Maria Kovacic has called for tax changes to boost home ownership, including capping the number of properties an investor can negatively gear, which puts her at odds with Opposition Leader Peter Dutton.Mr. Albanese quoted Senator Kovacic, saying, “[She] said this we should not be afraid to consider tax changes, whether they be capping the number of properties that can be negatively geared. That was in a first speech ... where you go along and you say what you really believe in.”
He also seized on comments by federal Liberal MP Keith Wolahan, who has said falling levels of home ownership was part of the reason why the party struggled to win votes.
He was also on record saying, “Are we the party of inner-city anaesthetists who vote Teal and own ten rentals? Or are we the party of young families looking to own their first piece of Australia? Every lever must be on the table.”
Mr. Albanese concluded with: “What we’re doing about housing, we’re focusing on supply. And we had a tax change in the budget to encourage build-to-rent.”
Opposition Decides to Back Tax Cut Changes for High Earners
But the exchange highlights the fact Mr. Dutton’s decision to support the revised Stage Three tax cuts has left it unable to land a telling blow on the government.On Feb. 6, Mr. Dutton announced that the Coalition would attempt to amend the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024—which enacts the revised cuts—but will not vote against it if those amendments fail.
“We are supporting this change not to support the prime minister’s lie but to support families who need help now,” he told reporters.
However, such a distinction is unlikely to resonate outside of Canberra, with most voters simply registering that the opposition has supported the move.
Under the new plan, the lowest rate of tax will drop from 19 cents for each dollar, down to 16 cents, on earnings under $45,000 and above $18,001.
The second tax bracket remains the same, and will be cut from 32.5 percent down to 30 percent, but it will now apply up to yearly salaries of $135,000.
The 37 percent rate will now be retained, and will apply from $135,000, up to $190,000. While the top tax bracket of 45 percent will be increased and will kick in from $190,000, up from $180,000.
