Prime Minister Anthony Albanese has ruled out changes to negative gearing, saying tinkering with the tax concession could harm housing supply.
Property investors can negatively gear properties to write off losses against other income, reducing their overall tax bill.
Treasury is reportedly modelling the impact of policy changes, but Mr Albanese took a more definitive stance on Thursday when asked if Labor would include negative gearing reform in a tax package for Labor's election offering.
"No, we're not," he told ABC TV.
Reforms could span capping how many properties can be negatively geared or scrapping it completely while grandfathering it, meaning those who currently access it won't have their arrangements changed.
Limiting it to new builds has also been put forward by proponents of reform, with the case for such a scaleback resting on encouraging investment in new homes to boost housing supply and therefore put downward pressure on rents.
But Mr Albanese said he couldn't see the positives in negative gearing changes, with experts warning it will sap investment from the sector and not address supply, which remained the focus of his government.
"The problem is all of the analysis shows that a change to negative gearing will not assist supply," he told Sky News.
The opposition has seemingly ruled out any changes to negative gearing, with its housing spokesman Michael Sukkar and shadow treasurer Angus Taylor talking down the effectiveness of reforms.
Mr Sukkar said housing was taxed enough and he ruled out support for a cap to the number of houses the concession applied to.
The majority of people who negatively geared property only had a single investment, he said.
"We support the current arrangements that Australian mums and dads rely on as a normal feature of the tax system," he told Sky News.
"If someone is able to negatively gear their share portfolio, a mum or dad should not be denied the same opportunity with owning an investment property."
Mr Taylor added: "I don't know how taxing mum and dad investors more is going to increase supply".
The opposition has also taken aim at Mr Albanese's rhetoric on the issue, as he repeatedly used the phrase there were "no plans" to touch the concession.
He again used the phrase across breakfast television on Thursday before his more terse edict on the public broadcaster.
It's drawn criticism as its the exact words he and his ministers used ahead of breaking a pledge not to change a tax cut package.
Mr Sukkar called it "verbal gymnastics".
Mr Albanese defended changing the tax package to favour lower to middle-income earners, saying times had changed.
The Greens seized on this to argue economic times had indeed changed, which was why negative gearing and capital gains reform was necessary.
The tax breaks drive rental prices up by favouring wealthy landlords, which also increases the cost of housing and locks first homebuyers out of the market, the minor party's housing spokesman Max Chandler-Mather argues.
The debate reignited after reports the Treasury was considering policy options for negative gearing.
Mr Albanese said he didn't tell them to do it and it was a good thing the public service was being "creative" while Treasurer Jim Chalmers said his department "looks at all kinds of different policies from time to time".
"Treasury don't need to be directed, they're not schoolchildren with teachers up the front of the class, telling them what to do," Mr Albanese said.
Opposition Leader Peter Dutton said blaming the public service "just doesn't pass the pub test" as it undertakes tasks it's instructed to investigate.
He's already geared up a scare campaign over reduced tax incentives after the coalition smashed former Labor leader Bill Shorten for trying to introduce the policy at the 2019 election.
Already being wheeled out on social media, the days of speculation has provided tinder for a favourite coalition slogan: "When Labor runs out of money, they come after yours".
Australian Associated Press
