The Senate Economics Legislation committee delivered its report into the Major Bank Levy Bill 2017 yesterday, with the Coalition-controlled committee recommending minor changes.
The committee recommended a review of the bank levy – which is expected to raise $6.2 billion from the four major banks and Macquarie over four years – after a minimum of two years.
The report recommended the Senate economics legislation committee examine the efficacy of the policy, its effect on competition and whether the levy is required in perpetuity.
Treasurer Scott Morrison has indicated the major bank levy’s objective is to ‘repair’ the federal budget.
Second, the report recommended Treasury should closely examine technical aspects to the bills to determine if changes are required to avoid double taxation.
The committee also recommended that Treasury provide greater explanation for the exclusion of foreign banks, and why Macquarie is subject to the levy when foreign-based competitors are not.
The Treasurer should have authority to suspend the levy in “extreme financial or economic circumstance” on the advice of APRA, said the report.
“Subject to consideration of the other recommendations, the committee recommends that the bills be passed,” concluded the report.
Labor’s ‘additional comments’ supported the bill while drawing attention to the leak of the levy on budget day and the “impact on customers”.
Australian Bankers’ Association chief executive Anna Bligh welcomed the Senate report, and repeated her calls for a ‘sunset clause’ for the levy once the federal budget is in surplus.
“This review was recommended by a number of banks and I’m pleased to see the committee take the concerns of affected banks seriously,” Ms Bligh said.
“We urge the federal government to more fully investigate the issue of double taxation, as recommended by the committee, to ensure that Australian banks are not disadvantaged when they compete offshore,” she said.
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