Anthony Albanese has been blasted by the Coalition for potentially considering axing negative gearing for property investors, even as his own $2.2million investment property goes on the market.
The Labor government has reportedly asked Treasury for advice on possible changes to tax exemptions for landlords, including modelling on the economic repercussions of phasing out the concessions.
Negative gearing policies allow property investors to claim tax deductions when the costs of owning and maintaining the property, such as loan interest and maintenance expenses, exceeds the rental income.
These tax benefits can reduce the investor’s taxable income, potentially leading to a lower tax bill.
When asked about the situation on Wednesday, Mr Albanese did not deny seeking advice from Treasury. Instead, he said: ‘What we do is we value the public service.’
‘So from time to time, I’m sure the public service are looking at policy ideas. That’s because we value them.’
Earlier this year, the Prime Minister evicted his long-term tenant in Dulwich Hill, in Sydney’s inner-west, and listed the brick townhouse for auction.
A senior Opposition spokesman has accused the PM of ‘making a ton on his rental properties’ and ‘pulling up the ladder behind him’.
Anthony Albanese (pictured with his partner Jodie Haydon) may look at negative gearing changes
Jim Flanagan, 45, has lived in one of Mr Albanese’s investment properties in the inner-west Sydney suburb of Dulwich Hill for four years
It comes as a RealEstate.com.au analysis has shown Mr Albanese could have claimed tax breaks of up to $25,000 in his first year of owning the investment property.
‘Pretty curious isn’t it, now Anthony Albanese is finished making a ton on his rental properties he is selling up and getting Treasury to look at pulling up the ladder behind him,’ the Opposition spokesman told Daily Mail Australia.
‘Why should middle Australia cop another hit so Labor can blow more money on wasteful spending like hundreds of thousands of dollars on Business Class trips for the “First Nations Ambassador” or taxpayer funded jobs for union officials?’
That was a reference to Justin Mohamed, the First Nations People’s Ambassador, who spent about $145,000 on business class flights last financial year – while making $350,000 a year.
The spokesperson continued: ‘Albo should spend less time trying to increase taxes and sort out his spending addiction.
‘Labor sees middle Australia as a cash cow and they are cooking up more taxes – I reckon most Australians are bloody fed up with it.’
Mr Albanese’s tenant Jim Flanagan, a struggling bar owner, revealed in May he had been given 90 days to leave property before it hit the market.
Anthony Albanese’s investment property is up for sale. It is worth about $2.2million
The Prime Minister said he was selling the property (pictured) for personal reasons
The PM said his personal life had changed and that he had decided to sell the property. The three-bedroom house is currently on a real estate website and is yet to be sold.
‘He has every right to do this,’ Mr Flanagan previously told media.
‘I’m not suggesting that he doesn’t. But I think renters again are really exposed at the moment, that power imbalance has been exacerbated by the rental crisis and the cost-of-living crisis.’
‘I guess we’re just looking for again a little bit more of a considered communicative approach. Maybe a discussion. I certainly wasn’t even provided with the opportunity to discuss an increase of the rent, staying a little bit longer, potentially if the house was going on the market.’
It was then revealed Mr Albanese had reduced the rent for Mr Flanagan during the pandemic and did not raise it back to market value two years later, before he decided to sell.
If Mr Albanese was making a loss on the property, he likely benefited from negative gearing.
Speaking at a press conference in Tasmania on Wednesday, the Prime Minister deflected questions about changing negative gearing and would not be drawn on whether or not his government asked Treasury for modelling.
‘I didn’t confirm that. Treasury, I’m sure like other departments, do a range of proposals, policy ideas. I want a public service that is full of ideas,’ he said.
Anthony Albanese would not confirm whether his government is considering changes to the tax benefits for property investors amid a housing shortage
But Treasurer Jim Chalmers on Wednesday confirmed his department was examining possible policy changes including negative gearing and the capital gains tax discount.
‘Treasury looks at all kinds of policy options all of the time,’ he told reporters.
‘It’s not unusual for the public service, and in my case my department, to examine issues that are being speculated about in the public or in the Parliament, that’s how a good public service operates.’
A separate ALP source confirmed that negative gearing changes were being considered, but the government could still decide not to move forward with any policy shift ahead of the next election, due by May 2025.
Former Labor leader Bill Shorten’s plan to get rid of negative gearing contributed to him losing the ‘unloseable election’ to Scott Morrison in 2019.
When Mr Albanese took over the party leadership, he said changes to negative gearing were off the table.
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