Fresher take on negative gearing?

By Gerv Tacadena | 28 Nov 2019

Negative gearing could still be one of the biggest concerns the Australian Labor Party will be focussing on in the next federal election.

Labor's housing spokesperson, Jason Clare, said the party could take a different route for its negative gearing and capital gains tax policies given that housing affordability is still a huge concern.

"We took a bunch of policies to the last election to tackle some of these problems. And we lost. Inevitably, we won't take exactly the same policies to the next election, but the problems we were trying to fix still exist. And they could get worse," Clare said at an industry function in Canberra.

Also read: Everything you need to know about negative gearing

During the two previous elections, Labor proposed slashing the capital-gains tax deduction for investors who had held a property for at least a year. It also planned to restrict negative gearing to new properties.

Labor has undertaken these policies in a bid to improve housing affordability and boost construction, according to a report in The Australian Financial Review.

A recent report by the Property Council of Australia said the Labor Party's downfall during this year's election was its negative gearing and capital gains tax policies.

Property Council chief executive Ken Morrison said Labor's policy would have shrunk the economy by $1.5bn and would have cost the construction industry $766m.

"At a time of declining housing construction and a slowing economy, these changes could have been catastrophic for the housing sector," he said.

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