Former prime minister Tony Abbott has delivered a blunt warning that the May budget should not raise taxes, while the Turnbull government works on a housing affordability package to form the centrepiece of the budget.
But the housing package almost certainly will not contain changes to capital gains tax concessions after the government publicly ruled them out on Thursday.
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PM has the final say
Malcolm Turnbull has made his views clear on whether there'll be company tax concessions.
Labor, which took a plan to reduce negative gearing and capital gains tax concessions to the last election, seized on a Fairfax Media report that the Coalition could curb CGT concessions for property investors to assist housing affordability and delivered a sustained attack on the Turnbull government in question time.
Options under consideration are said to include reducing the 50 per cent discount on CGT to 25 per cent; Grattan Institute economist John Daley said that change would eventually raise about $2 billion a year.
But Mr Abbott told Fairfax Media: "Labor is the party that believes in taxing and spending.
"What's the point of a Coalition government if we fail to encourage risk-takers and innovators, but penalise them with heavier taxes?"
The former prime minister's intervention underscores the internal pressures at play in the Coalition as it puts together a May budget that will focus heavily on cost-of-living issues for families - housing affordability, energy and childcare costs.
Treasurer Scott Morrison kick-started debate earlier in the week about possible tax rises, warning that if the Turnbull government was not able to realise $13.2 billion in savings in a so-called omnibus savings bill by the end of March, new revenue measures could be introduced to protect the AAA credit rating.
Michael Sukkar, the assistant minister to Mr Morrison, told Fairfax Media a new housing affordability package would be front and centre in the next budget.
Mr Sukkar, who has a specific brief to tackle housing affordability, declined to comment on possible CGT changes.
"The Treasurer and I have been methodically consulting with colleagues and developing policies that will help address housing affordability in our major cities. Addressing this issue will be a major priority in the next budget," he said.
"We [state and federal governments] all accept that addressing supply-side issues in the housing market is the primary issue in housing affordability and cannot be addressed by the federal government without the support and consent of state and territory governments."
On Thursday morning, Finance Minister Mathias Cormann had slammed the door on CGT changes when he said: "The government has absolutely no intention of reducing the capital gains tax discount or making changes to negative gearing."
In contrast, Mr Turnbull appeared to leave the door ajar slightly, saying: "We do not support the Labor Party's plans to increase capital gains tax or indeed their plans to outlaw negative gearing."
In question time, Labor attempted to draw out the government on the issue, while the government fired back by highlighting confusion over whether Labor's post-2020, 50 per cent renewable energy target was an aspiration, a goal or iron-clad policy.
By the fifth question on CGT, Mr Turnbull's response was emphatic.
"The statement by the Finance Minister this morning was absolutely correct and the government has no intention or plan to change capital gains tax or negative gearing. That has been our position, is our position, the only party with a commitment to increasing capital gains tax and abolishing negative gearing is the Labor Party."
Labor leader Bill Shorten then asked if the "Prime Minister's office, the Treasurer's office, or Finance Minister's office, any junior office requested any advice or modelling to capital gains tax?"
Mr Turnbull said he would not divulge the business of government, but that "Treasury officials look at a whole range of options, a whole range of studies" - an apparent admission the government had looked at CGT changes.
Despite the emphatic denials that CGT changes were an option, several sources in government insisted that "nothing's off the table" and that changes could still be made.
Mr Abbott's fellow backbench MPs George Christensen and Eric Abetz, meanwhile, also spoke out against any move to raise revenue through tax changes.
"If there are tax rises, you'd have to look at it on an individual basis, but I didn't come here to raise taxes. I'm in favour of lower taxes," Mr Christensen said.
"I got into politics believing in lower taxes and smaller government," Senator Abetz said.