Labor accepts defeat, scraps controversial tax reform

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July 26 2021
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Labor has taken a new stance on tax cuts and negative gearing in time for the next election.

Labor accepts defeat, scraps controversial tax reform

Federal Labor leader Anthony Albanese and the shadow cabinet have adopted a new policy position on negative gearing and stage three tax cuts.

In an announcement earlier today, Mr Albanese confirmed that “an Albanese Labor government will deliver the same legislated tax relief to more than 9 million Australians as the Morrison government.”

Following discussions earlier today, Mr Albanese confirmed that Labor’s caucus had ratified the party’s new position, upholding the legislated changes to personal income tax and maintaining the existing arrangements for negative gearing and capital gains tax.

Mr Albanese said that “Labor is providing certainty and clarity to Australian working families after a difficult two years for our country and the world.

“Our focus is on making sure Australia emerges from this crisis stronger and more resilient - with an economy that works for working families, not the other way around.”

“When it comes to the economy, the next election will be about the Prime Minister’s dangerous and costly failure to manage the pandemic,” he said.

Labor’s 2019 loss has been frequently attributed to the party’s position on issues like negative gearing and franking credits in the years since. Questions about these policies have dogged the party in the years since.

After changes to either of these issues were not mentioned in the opposition leader Anthony Albanese’s recent budget reply speech, many speculated that the party would move to drop them ahead of the next federal election.

“Changing current negative gearing or CGT arrangements would be the wrong policy, at the wrong time and have a perverse impact on housing affordability,” Property Council chief executive Ken Morrison said back in July.

Prime Minister Scott Morrison has yet to call a federal election. However, as per the official Australian Parliament website, the next federal election must take place before 21st May 2022.

The Australian Greens have slammed the move, with Greens leader Adam Bandt calling it “the sell-out of the century.”

“Tax cuts for billionaires means cuts to services for everyone else. We need to get dental into Medicare, not give tax cuts to billionaires.”

He warned that “this is the biggest attack on equality for a generation,“ and called on Labor to reconsider its decision.

“In the middle of a housing affordability crisis, Labor has caved to wealthy investors and the Liberals. This is a shocking move and betrayal of young people in particular,” said Greens senator Mehreen Faruqi.

About the author

Fergus is a journalist for Momentum Media's nestegg and Smart Property Investment. He likes to write about money, markets, how innovation is changing the financial landscape and how younger consumers can achieve their goals in unpredictable times.

About the author

Fergus is a journalist for Momentum Media's nestegg and Smart Property Investment. He likes to write about money, markets, how innovation is changing the financial landscape and how younger consumers can achieve their goals in unpredictable times.

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