Independent MPs broadly support the Albanese government’s push to reform negative gearing and capital gains tax settings for housing, but say the budget measures have been poorly communicated and should not extend to business investments without further consultation.
The group, including Sophie Scamps, Nicolette Boele, Monique Ryan, Kate Chaney, Zali Steggall, Allegra Spender and Helen Haines, acknowledged the government had broken its pre-election promise not to reform housing taxes. However, their responses differed on whether that breach would seriously damage public trust. Scamps said the broken promise added to already low trust in politics, while Boele argued many voters now expect politicians to break promises and were more focused on whether the government was acting on intergenerational fairness.
Several independents said the housing crisis justified reform. Ryan described the measures as overdue, saying they could help make housing more affordable, but criticised Labor for failing to explain why the same problems had not been addressed before the election. Scamps also said the changes had come “out of left field”, particularly because the capital gains tax changes went beyond property and affected other asset classes such as businesses.
Kate Chaney, the independent member for Curtin, was central to the article’s discussion of political promises and economic reform. She had previously campaigned successfully for Labor to break its promise not to alter the stage three income tax cuts, and she again argued that rigid pre-election commitments can prevent necessary reform. Chaney said the problem is that “sweeping promises shouldn’t be made in the first place”. She added: “If the media constantly push politicians to rule out any changes in the future, reform is impossible. That’s one of the reasons we have seen so little economic reform in the last 20 years.”
Chaney said she had been “loud and clear” in calling for changes to negative gearing and capital gains tax arrangements for housing, “because we need to pull every lever to turn around a housing crisis that is locking younger Australians out of the property market”. While acknowledging concerns over broken promises, she backed the government’s willingness to pursue longer-term reform. “While I can understand concern about broken promises, I’m glad the government has actually been willing to take on some longer-term reform. Australians value fairness and want governments to demonstrate leadership and bold action when the moment calls for it.”
At the same time, the independents were strongly concerned about the extension of CGT changes to business investments, start-ups and other productive asset classes. Ryan said early-stage investment and start-ups should be carved out, warning that the changes could chill innovation. Steggall similarly welcomed housing tax reform but said business investment changes had blindsided industry. Spender praised Treasurer Jim Chalmers for tackling tax reform but said the proposals were “not yet right” and urged the government to slow down, consult properly and ensure any extra revenue reduced marginal tax rates.