Greens leader Adam Bandt says his party will sink the federal government's $10 billion housing fund unless it is significantly improved, in what would become the first major legislative defeat of the government.
The government is yet to win enough support for its housing bill to pass the Senate, which would fund 30,000 social and affordable homes over the next decade through returns on the fund.
The Greens argue the Housing Australia Future Fund bill includes no support for renters and has no guaranteed minimum spend in the event that the fund does not generate a return.
The government needs the support of the Greens to pass the bill as the Coalition has confirmed it will oppose it.
But after weeks of negotiation without progress, Mr Bandt told the National Press Club his party would reject the bill as it stood.
"If Labor wants our support on the housing bill it needs to come to the table on the rental crisis and on building more public and affordable housing," Mr Bandt said.
"Is Labor really saying that they are willing to spend over half a trillion dollars on stage 3 tax cuts for the wealthy and on nuclear-powered submarines, but can't find $5 billion a year for public housing and $1.6 billion for a rent freeze in the middle of a housing crisis?"
To earn their support, the Greens have called for a fund to support a two-year rental price freeze, direct building of 225,000 publicly owned properties over the decade and a doubling of Commonwealth Rent Assistance, unless income support payments such as JobSeeker and Youth Allowance are increased.
Greens propose negative gearing wind-back to pay for proposals
The Greens say their proposals would cost the government just shy of $70 billion over the decade, which they propose could be paid for by phasing out negative gearing for people with two or more investment properties, and abolishing capital gains tax discounts on assets held for more than 12 months.
Under the Greens' proposal, the "negative gearing" tax scheme that allows investors to deduct net rental losses from their income tax would be phased out over five years on multiple properties, and investors instead would be required to choose just one they could apply the discount to.
Treasury tax statements in 2019-2020 found three-quarters of the tax deductions claimed using negative gearing were by the top 10 per cent of earners.
"This isn't about someone who owns one extra house or flat as an investment in addition to their main residence. They're not affected by the Greens' proposal," Mr Bandt said.
"We're calling for an end to the tax breaks that the government is currently giving to people who own three, four, 12, or 25 properties. It's about the 20,000 wealthy moguls who own more than six properties each."
Labor took a similar proposal to reform negative gearing to the 2019 election but was defeated.
Prime Minister Anthony Albanese said the Greens' position was "completely illogical".
"They want more investment in social and affordable housing and their strategy to do that is to block $10 billion to create a fund for investment in social and affordable housing," Mr Albanese said.
"If the Greens vote against the $10 billion housing Australia Future Fund they are voting against $10 billion of investment into social and affordable housing.
"They will be held to account for it, and any of their rhetoric about housing issues will be regarded as just farcical if they vote against this fund."
Mr Albanese said the housing fund was in addition to other housing supports the government had already introduced, including an agreement with the states and territories to build 1 million new homes over five years, accompanied by an additional $350 million over that time.
