Larissa Waters (Queensland, Australian Greens) Share this | Link to this | Hansard source

My question is to the Minister for Finance, Minister Gallagher, representing the Treasurer. Housing cost is the single biggest contributor to recent inflation. The RBA governor yesterday singled out credit growth as a cause for concern. We know that property investors borrowed a record high $40 billion in the last three months of last year alone, and that was largely to buy existing homes, not new builds. Investors are flooding into the market at record rates, and the Labor government is giving them massive tax handouts to help them push up house prices. Will Labor use this budget to cut these unfair tax handouts for property investors and give renters and first home buyers a real shot at buying a home?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I thank Senator Waters for the question. This government is rolling out, as Senator Wong outlined in an earlier answer, a very ambitious housing agenda that we started in 2022 when we came to government, to make sure that we are doing everything we can to increase the supply of housing across the economy. That has been our focus. Our tax policies on housing haven't changed.

We've said a number of times—I've heard the Treasurer say it a number of times; I know it was raised at the Economic Reform Roundtable—that we do think there are intergenerational issues in housing. Our work over the last three years or so has been on the supply side and on making sure that we are doing everything we can, whether it's working with the states and territories to deal with some of the planning and regulation around housing that delay the construction of housing and add to costs or whether it is actually dealing with the social and affordable end of the housing market, which the Housing Australia Future Fund plays a role in. Our social housing accelerator is another example where we have, again, worked hard to target some of that assistance to deliver increased supply, and we are seeing some early good signs in terms of building approvals, new dwelling construction and dwelling commencements. We are seeing some pleasing signs in that area.

The measures that all governments across Australia—it's not just the Commonwealth government but all of us—are working on to deliver an outcome on housing are starting to work. There is more to do, and we will consider all of these things as we put the budget together over the next few months.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Waters, first supplementary?

Larissa Waters (Queensland, Australian Greens) Share this | Link to this | Hansard source

There's speculation today that Labor will reform the capital gains tax discount in this year's budget. According to Treasury, an astonishing 54 per cent of this tax handout goes to the wealthiest one per cent and just four per cent of it goes to people under 35. This is the most unfair tax handout in the Commonwealth tax code. When will Labor scrap this handout to the one per cent?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

As I said in answer to the earlier question, our tax policies haven't changed. In relation to tax reform, we do have a number of reforms underway, and we've said repeatedly that we're up to considering further work, particularly work that comes out of the Economic Reform Roundtable.

When we're looking at what we've got to do now, we've got instant deductions to implement, we've got better targeted super to get through the parliament, we've got the tax cuts that will come in over the next little while and we've got the low-income tax offset in super that we will also need to implement. All of that is underway. I think you can see that we have a range of areas of tax reform underway, but our position on housing and tax has not changed.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Waters, second supplementary?

Larissa Waters (Queensland, Australian Greens) Share this | Link to this | Hansard source

On another unfair tax handout the Greens have called out for decades, scrapping fuel tax credits, which give cheap diesel to big mining companies, would free up around $8 billion a year, which could be used for cost-of-living relief to households. If Labor is going to cut spending to deal with inflation, will you cut this unfair fossil fuel subsidy for big mining companies?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I think, in the earlier answer, I covered the areas where we are currently working in tax reform. It's delivering on the tax cuts we took to the last election. It's our better targeted superannuation reform. It's the instant deduction, which was also an election commitment of ours. It's the low-income super tax offset that we have announced. All of those areas are the focus. In relation to other areas of tax, our policies haven't changed.