‘IMPOSE LEVY ON FOREIGN BANKS, TOO’
Govt can recoup up to A$800m by applying tax on overseas lenders, says lawmaker
AUSTRALIA should extend its new bank levy to foreign financial institutions in a bid to recoup more than the planned A$6.2 billion (RM19.89 billion), says cross-bench lawmaker Nick Xenophon.
Applying the tax to foreign banks as well as the nation’s five biggest lenders might recoup as much as A$800 million, which could help fund compensation for victims of financial mismanagement and fraud, Xenophon told the Australian Broadcasting Corp (ABC) yesterday.
“It’s important that foreignowned banks that have a big presence here in this country also be hit with this levy,” he told the ABC’s Insiders programme.
“The big banks are saying, ‘well, if you are going to hit us with this, why aren’t you hitting the foreign banks?’ I think they have a point.”
Australia planned to raise billions over the next four years by imposing a six basis points levy on liabilities over A$100 billion, said Treasurer Scott Morrison in the budget released May 9.
The levy would apply to Commonwealth Bank of Australia, Westpac Banking Corp, Australia & New Zealand Banking Group, National Australia Bank Ltd and Macquarie Group Ltd, according to Treasury.
Those major banks called for foreign competitors, including ING Groep NV, HSBC Holdings Plc and Rabobank to be netted by the new tax, according to submissions to Treasury last week in response to the budget.
Morrison said offshore firms provided competition and the government wanted Australia’s banking system to be competitive when he was asked on May 19 if he would extend the levy to foreign banks. Bloomberg