Tanya Plibersek (Sydney, Australian Labor Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. Yesterday during Senate question time the Attorney-General, representing the Prime Minister, said, 'It has always been the position of coalition governments to have an in-principle opposition to retrospectivity.' Can the Prime Minister confirm that this has always been the coalition's policy and, if so, won't the Prime Minister now rule out any retrospective changes to negative gearing?

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

I thank the honourable member for her question and I would remind the honourable member of the importance of considering changes to the tax system with great care. The tax system is the biggest single force of influence the federal government has on the economy. In March or April last year my predecessor, the member for Warringah, and the former Treasurer, the then member for North Sydney, launched an open conversation with the Australian people on tax reform in publishing a discussion paper, which raised a wide range of issues. And there has been an open discussion about tax policy ever since.

The government is considering these matters and considering them very carefully. We are taking the best advice and analysing the impacts of various proposed changes with great care and diligence, a diligence which the opposition, plainly, has not done. The honourable members opposite know full well that the changes they have proposed to capital gains tax—no doubt, in a rush of blood to the head of wanting to deal with all of those rich investors who do so well out of capital gains—what they have done, at a time when, plainly, we need more investment—we want more entrepreneurship; we want people to take risks; we want them to invest in businesses large and small—at that time, at that very juncture in our economy, in our transition, when we are, as the Treasurer has said, actually providing incentives to invest, the Labor Party is proposing to impose a 50 per cent increase in capital gains tax, which will, obviously, provide a massive disincentive to invest.

The honourable members opposite can shake their heads if they wish but the reality is that if you want people to invest, with a view to achieving a capital gain, then you do not increase the capital gains tax by 50 per cent. What they have sought to do, of course, with their proposal to outlaw negative gearing from 1 July 2017, in established properties, is strike at the ability of ordinary families on modest incomes, average incomes—nurses, policemen, teachers—preventing those people from investing.

Tanya Plibersek (Sydney, Australian Labor Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

They can still buy a new house!

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

The honourable member opposite says they can still buy a new house; the Labor Party will not stop them doing that. But this is a very important point. What the honourable member opposite has conceded is that she wants to ban Australians on average incomes from making an investment in established properties. She wants to limit them to buying homes they are not able to invest under her— (Time expired)