“We’re hoping they don’t do that because that was certainly the message they gave us before the election. They said that if they didn’t mention anything in the run up to the election that we could ignore previous policy positions but we’ll just have to wait and see,” said Mr Maroney.

“We would certainly be concerned if they did make any policy changes [around borrowing].”

Mr Maroney noted that large APRA-regulated funds use borrowing indirectly through unit trusts in order to invest in things like property.

Removing borrowing for SMSFs would therefore create an unloved playing field between the SMSF and APRA-regulated funds, he stated.

He also pointed out that there has not been a significant jump in the total amount of borrowings through SMSFs.

“The total amount is only around $23 billion which is a fairly small percentage and it was that same $23 billion five years ago. So there’s been no real increase in borrowings over that time according to the ATO statistics,” he stated.

AIST recently called for a ban on LRBAs in its pre-budget submission, stating that borrowing through SMSFs created the “potential for systemic risk”.

LightYear Docs director Grant Abbott previously warned that LRBAs could be seen as an easy target in the upcoming budget with the government grappling with a huge budget deficit and a housing crisis.

“There’s a lot of arguments that they could potentially raise for it,” said Mr Abbott.

“Number one is that its a good tax saving for them. On the other side of that they could say that SMSFs have been pulling investment properties out that could be used for first home buyers.

“My gut feel is that we are pretty close to seeing some major changes for SMSFs and that the first one is going to be borrowing.”

Labor previously proposed a ban on limited recourse borrowing arrangements in SMSFs in the lead up to the 2019 election, which was won by the Coalition.

The ban was proposed back in 2017 as part of a housing affordability package.

Treasurer Jim Chalmers stated earlier this year that Labor would not be proceeding with previous policies from the 2019 election such franking credit changes but has more recently stressed the need to tackle the huge deficit and address the shortage of housing.