Angus Taylor (Hume, Liberal Party) Share this | Hansard source

I have seen the replay. There is an extremely dangerous part to what Labor is proposing in its tax plans and that is the tax on negative gearing. There are three reasons this will have a such a big impact. First, and most importantly, they have forgotten that the supply of housing is inelastic in this country. Go back to economics 101. Inelastic supply: you reduce demand and it has a sharp impact on price. They are the basics. They are the basic economics. If you are going to take a third of the demand out of the market, then you can be absolutely assured that with inelastic supply you are going to whack prices.

The second part of this that you need to be extremely cautious about is that there are over $2 trillion of household debt—160 per cent of GDP. That is one of the highest in the world. We have more household debt than the UK at 130, the US at 100, Spain at 115 and Greece at 75 per cent. Have you forgotten that sharp changes in housing prices were behind the GFC?

We are focused on supporting Australians who want to have a go, who want to work hard, who want to save and who want to invest for their future. Labor just wants to slug Susie—the mythical figure in their policy documents—who is on average weekly earnings. (Time expired)

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