House prices are in decline. Is there a reason for the Albanese government to flat-out break a promise?

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I’m not sure I can recall any government getting away with what the Albanese government this week confirmed it will attempt. We now know the upcoming budget will include changes to negative gearing and capital gains tax concessions. We also know that, whatever the details end up being, this flatly breaks a pre-election promise to leave these concessions untouched. That means the government is about to undertake a sizeable, controversial reform, for which it has no mandate.

This is not like Labor’s 2024 amendments to the Morrison government’s stage 3 tax cuts. Yes, that was also a flat-out broken promise. And it’s emphatically true that broken promise didn’t hurt the Albanese government, which was returned last year with such a thumping majority that its repercussions are threatening to upend the two-party system. But that policy tweaked a tax cut that was not yet in force. By the time the amended package became real, every taxpayer experienced it as a tax cut. For the highest earners, it was a lesser cut than they had originally been promised, but it was a tax cut nonetheless. No one experienced it as a tax hike. The most this proves is that you can get away with a broken promise as long as it generates no losers.

That’s probably why Treasurer Jim Chalmers is saying any changes won’t raise “a heap of revenue” in the next few years, and that there will be “transitional matters” to soften the blow to current........

© The Sydney Morning Herald