DEPOSIT TAX WITHDRAWN PM declares $1.5b ‘Labor idea’ dead for good
SAVERS should be spared higher costs after the Federal Government dumped its plans for a bank deposit tax.
Prime Minister Tony Abbott announced he would dump the 0.05 per cent tax on deposits up to $250,000 just months after Treasurer Joe Hockey had signalled he wanted to impose it only on the Big Four banks.
But the Government will suffer a $1.5 billion hit to its Budget as a result of the backdown. The tax was initially planned under Labor, but not legislated and the Coalition was planning to impose it from 2016. Mr Abbott yesterday labelled the impost a “Labor tax” as he killed it off.
“Labor’s bank deposit tax is dead,” Mr Abbott said.
“The last way to make our banks strong, the last way to protect depositors is to hit banks with more taxes.”
Mr Hockey denied he had been rolled over the plans by Cabinet, saying he arrived at the decision to abandon the tax after discussing it with banks and other groups.
“Now is exactly the wrong time to apply such a tax to bank accounts, when people are receiving lower returns than they may have expected in the past,” he said.
The deposit tax was meant to go into a fund to be used if banks collapsed in another financial crisis.
It was originally proposed by the Reserve Bank of Australia, Treasury and banking regulator APRA.
The $1.5 billion the tax was expected to raise over four years was counted on the Government’s bottom line, meaning it will add to the deficit unless it is offset with new savings in the mid-year Budget update later this year.
Mr Hockey said banks had since accepted they need to increase their capital, which would guard against the risk of a collapse.
The policy change came as Cabinet shelved plans for changes to competition law to help small business, which was fiercely opposed by large firms.
Banks and seniors’ groups welcomed the backdown on the deposit tax.
WE have now been without a chief justice in Queensland for two months since Tim Carmody resigned after a year of controversy and upheaval in our courts and legal community.
Attorney-General Yvette D’Ath announced she would consult with appropriate people in the judiciary and peak bodies such as the Bar Association and the Law Society, although the annual mid-winter break most judges take delayed this process somewhat.
In essence we are where we were on July 1. We know nothing beyond the facts: we have no chief justice, the Attorney-General is consulting and there is no timeline on what is happening.
Premier Annastacia Palaszczuk and her Labor colleagues were harsh critics of Campbell Newman’s LNP for the way the selection and appointment of Justice Carmody was undertaken.
They criticised Mr Newman and his attorney-general Jarrod Bleijie for not consulting and making an “outsider” appointment of Justice Carmody from chief magistrate to the top judge in the state.
The concurrent uproar from other judges and senior lawyers added to a perception the appointment was botched and set the stage for Justice Carmody’s predicted demise to slide toward inevitability.
Given that Justice Carmody first telegraphed, in an interview with The Courier-Mail, the possibility he might leave the Supreme Court early into his tenure soon after the January 31 election, the Government should have been thinking of what to do in the event he did step down long before it became official.
That we have heard nothing from the Attorney-General since her initial response to his resignation is starting to look more like dithering than deliberation. We would have thought a Government that complained so loudly about secrecy and opaque decision- making under the LNP would have been a little more communicative and transparent in its processes.
This is not to suggest we should have a running commentary on who Ms D’Ath is consulting with and who may or may not be on any shortlist, but rather an assurance that the process of selecting a new chief justice is proceeding and appropriate people are being spoken to.
One of the problems with the appointment and brief tenure of Justice Carmody was the publicity and sense of crisis it attracted.
There was never a sense of the calm and quietude associated with superior courts and judges.
It would be a pity if the selection of a replacement was to begin in controversy because the Government did not take the people of the state into its confidence.
We are also entitled to hear what the Government’s plan is to make this selection process, and the oversights of the courts generally, more transparent and accountable.
Some lawyers, such as Bill Potts and Rebecca Fogerty writing in The Courier-Mail today, argue for an independent judicial selection panel that could draw up a shortlist for consideration by the attorney-general and cabinet. There are also suggestions for a judicial commission to handle issues that arise concerning judges.
At the moment we have the ultimately unsatisfactory situation of the chief justice being responsible for accounting for him or herself and other judges.
All of these are worthwhile ideas to consider and, after six months in office, we should have at least an outline of the Government’s thinking on such important matters.
Ms D’Ath and Ms Palaszczuk should put this at the top of their list for action and get on with selecting someone and appointing them.