Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

Mr Speaker, my question is to the Prime Minister. The Treasurer has today confirmed the government will make changes to superannuation concessions, but just two weeks ago the former Prime Minister described changes to superannuation tax concessions as:

… a seniors' tax, in the shape of more taxes on super.

Does the Prime Minister agree with the man he replaced? Will the government make changes to superannuation concessions?

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

The honourable member's inquiry is understandable, but he will have to wait until the budget to find out what is in it. Obviously the budget speculation bug will continue to infect the honourable members opposite, right up until budget night.

One thing we do not have to wait for is the Labor Party's self-described 'Positive plan to help housing affordability'. This proposes very significant changes to tax. Earlier, in an answer to a question from the member for Sydney, we were talking about tax on tobacco. One of the reasons tobacco is taxed is to make it more expensive, and the more you tax anything the less likely people are to use it because it is more expensive. That is the purpose of so-called sin taxes. Apparently, the Labor Party think investment is a sin, because they are increasing taxation on investment. They are going to increase capital gains tax by 50 per cent.

It is a signal example of the difference between the government's approach and the opposition's that tomorrow we will be introducing into this House legislation that will provide a tax incentive for people to invest in start-up companies and, if they hold the investment for a substantial period, they will get a capital gains tax exemption.

Ms Butler interjecting—

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

The member for Griffith is warned!

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

So we are actually providing tax relief for the express purpose of encouraging investment. What Labor is doing is proposing to increase tax, which will have, inevitably, the same consequence: it will discourage investment. You increase the tax on something, you will get less of it; you lift the tax off, you will get more of it. That is Labor's approach.

The rest of the honourable members' housing affordability project will result in house prices being reduced, new homebuyers being squeezed out of subdivisions and the amount of rented property—that is to say, property available to tenants—reducing over time so that, inevitably, rents will go up. So house prices will come down, new homebuyers will be squeezed out because when they go out to buy a home and land package in Camden or the outskirts of Sydney or Melbourne, when they go out to do that, they will find that they will be crowded out by investors because that is the only asset class people will be able to negative gear. So they will be crowded out, and then elsewhere in the market, in properties that are bought and built for tenants, the investor owners of that will only be able to sell them to homebuyers. Inevitably, rental property will diminish and rents will go up. What an extraordinarily bungled outcome by an opposition that does not understand the first thing about the property market.