Bill Shorten (Maribyrnong, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. In 2012 the now Prime Minister gave a speech in parliament promising to oppose legislation 'on the basis that it is retrospective'. Why won't the Prime Minister now rule out retrospective changes to negative gearing—or, put another way, why won't New Malcolm just agree with Old Malcolm?

Christopher Pyne (Sturt, Liberal Party, Leader of the House) Share this | Link to this | Hansard source

Nine months ago you said you weren't going to change it.

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

The Leader of the House will cease interjecting.

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the Prime Minister for the opportunity to respond in relation to negative gearing, because one of the key issues around negative gearing that those opposite have liked to raise is the issue of fairness. They think that somehow this is going to create some greater fairness. But I wonder if they have contemplated this scenario. They raise these issues in the context of fairness, but is it fair for, say, a part-time teacher in Fairfield in Western Sydney, in the member for McMahon's electorate, who wants to return to work in the second half of next year if they were to be successful at the next election, after she has had children? They go back and they buy an investment property, which would be denied under those opposite, to offset the net rental losses. They would have a salary of some $40,000 a year. Under the policy of those opposite, they would not be able to negatively gear that property they bought to secure the future of their family. That is what happens with an existing property under their policy.

But consider someone in the member for Sydney's electorate: a senior executive earning, say, $600,000 a year in a cash salary but, more importantly, pulling down some $75,000 in dividends—

Government Members:

Government members interjecting—

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

The members for Lyons and Deakin will cease interjecting. The Minister for Resources will cease interjecting. The Leader of the Opposition on a point of order?

Bill Shorten (Maribyrnong, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

It is. It is on the point of order of relevance. This is the fifth question we have asked the Prime Minister on retrospectivity. Why can't he just rule it in or out? Why is he hiding?

Mr Whiteley interjecting—

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

The Leader of the Opposition will resume his seat. The member for Braddon will cease interjecting. The member for Herbert was right in blaming him that time! The Treasurer is relevant to the question.

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

So we have the part-time teacher who wanted to buy an investment property and negatively gear the rental losses. They cannot do that under their policy, but the banking executive living in the member for Sydney's electorate, who could have $50,000 or $75,000 worth of dividends, could under their policy, if they go buy an existing investment property, negatively gear it. They can negatively gear it.

This is probably just one of the many things that the member for McMahon and the Leader of the Opposition did not talk about when they were not talking about negative gearing on their side. What the policy says is you can negatively gear against investment income but not on a wage and salary earning. You cannot write it off.

Honourable members interjecting—

Whether it is on fairness, whether it is on the issue of the mayhem it would create in the property markets, if you buy a new property, the minute you put the key in the door under their policy, it becomes an old property and you cannot sell it to one out of the three people who would previously have bought it. Under their policy, it is like driving a new car off the lot. They just have not thought it through. That is why, when it comes to tax policy, they cannot be trusted to manage the transitioning economy as this side of the House can.

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

There were a large number of interjections through that answer. The member for McMahon has been interjecting regularly. He is now warned, as are the member for Hotham and the member for Deakin, who I have asked to cease interjecting a number of times on a number of days.