Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Prime Minister. Will the Prime Minister today rule out cutting the capital gains tax discount for millions of Australian superannuation accounts?

Mr Joyce interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The Deputy Prime Minister will cease interjecting. The Prime Minister has the call.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his question and the opportunity to remind honourable members of the recklessness of the Labor Party's plans to undermine property prices in Australia. I remind honourable members that, as far as superannuation is concerned—

Mr Perrett interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Moreton will leave under 94(a).

The member for Moreton then left the chamber.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

Superannuation is taxed at very concessional rates. I think honourable members will understand that the earnings of funds receive a concessional tax treatment, which is 15 per cent, during the accumulation phase and benefits are tax-free when they are drawn down. The one-third capital gains tax discount to which he refers—on capital gains for super funds—reduces it to 10 per cent, so it is from 15 per cent to 10 per cent for assets held for longer than 12 months. So the tax on superannuation funds earnings in the accumulation phase, whether it is regarded as income or capital, is remarkably low. It is very concessional. That is part of the scheme.

What we are looking at is the entire superannuation system, as you would expect in any responsible review of taxation.

Opposition members interjecting—

Unlike the Labor Party, we are not rushing into snap decisions—to reckless decisions—which are going to undermine property prices.

Opposition members interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

Members on my left!

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The honourable member, like me, lives in Sydney. He might consider this: in Sydney the National Australia Bank expects housing prices to increase by 1.2 per cent. That is actually less than inflation.

Mr Thistlethwaite interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Kingsford Smith is warned.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

In real terms the properties belonging to his constituents will decline in value according to the National Australia Bank. In real terms people will be worse off in the electorate of McMahon. What he is proposing to do is to take one-third of the buyer demand out of that market, and that will inevitably provide a shock and a reduction—

Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. On this question there was one issue alone that was raised, and it was about superannuation. The Prime Minister cannot be being directly relevant in his current answer.

Tony Smith (Speaker) Share this | Link to this | Hansard source

I am listening carefully to the Prime Minister's answer. He has certainly been on the policy topic of superannuation and taxation. I listened very carefully to the question. The Prime Minister has a little under 50 seconds left, and I will keep listening as the Prime Minister completes his answer.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

But the reality is that the member for McMahon, the shadow Treasurer, has committed his party to a policy that will make every homeowner in his electorate poorer. Every single homeowner in his electorate will be poorer unless you believe in the Alice in Wonderland economics—

Tony Smith (Speaker) Share this | Link to this | Hansard source

I am just going to ask the Prime Minister to refrain from drifting into other policy areas—

Opposition members interjecting—

and members on my left will cease interjecting. As I have made clear in earlier rulings, ministers are free to discuss the policy topic that has been raised, and the policy topic has been taxation and superannuation—capital gains tax in particular. The Prime Minister has the call.

Michael Danby (Melbourne Ports, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

Where are the 200,000 new immigrants going to live?

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Melbourne Ports is warned.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The savings of Australians are contained in superannuation. They are above all contained in their homes. That is their single biggest asset. The Labor Party's policy in a vulnerable, delicate housing market where growth is forecast to be very low if at all, is threatened— (Time expired)