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Treasurer Scott Morrison has delayed the first payment of the controversial new bank levy. He also argued that the added costs aren’t an excuse for the major banks to alter their mortgage or deposit rates.
Economists have warned that the federal government’s new $6.2bn bank levy would result in an increase in funding costs, which would then be passed on to borrowers.
In his second reading speech on the Major Bank Levy Bill in Parliament House, Morrison said the first levy calculation and instalment would be postponed by three months, with the first payment now occurring on March 21, 2018.
“The government is working with the banks to ensure a smooth transition to the new regime. To assist major banks to begin to comply with the levy, the first levy calculation and instalment will be delayed by three months – at no cost to revenue – to provide additional time for banks to make necessary systems changes,” Morrison said.
This means that the banks—CBA, ANZ, Westpac, NAB, and Macquarie Group—will have to pay for both the September and December quarters for 2017 on the same day. Meanwhile, the levy for the March quarter of 2018 will be payable on June 21, while that for the June quarter will be payable on Sept. 21.
Customers should not be impacted by the levy
Morrison has made it very clear that the new levy will not serve as an excuse to increase costs for customers.
“That is why the government has directed the ACCC to undertake an inquiry into residential mortgage pricing. The ACCC will be able to use its information-gathering powers to obtain and scrutinise documents from any bank affected by the levy and to report publicly on its findings.”
Morrison said he expects the banks to balance the needs of borrowers, savers, shareholders, and the wider community following the introduction of the levy.
“The ACCC inquiry will illuminate how the banks respond to the introduction of the levy and give all Australians the information they need to get a better deal elsewhere from any of the more than 100 other banks, credit unions and building societies, as well as other non-bank competitors,” he said.
However, Anna Bligh, CEO of the Australian Bankers’ Association (ABA), said these costs will be passed on to the public regardless of any official sanctions.
“The government’s own figures and the government’s own documents can see that the impact of this tax is likely to fall on savers, borrowers, lenders and shareholders,” she said. “We don’t have to wait for this tax to be introduced for it to have an impact on Australians right now. Since budget day, $39bn has been wiped off the market value of our five largest banks. And every Australian who has a superannuation account will see a loss of value.”
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