The nation’s five biggest banks are willing to wage a mining tax-style ad campaign against a “fast and loose” $6.2 billion tax, which they say will leave Australian retirees and workers worse off.
The banks say they’ve walked away from a meeting with Treasury officials on Thursday with more questions about the tax than answers.
They say they’re still none the wiser as to how the revenue figure was reached, how much each institution will pay, which parts of their businesses will be targeted or if it will apply to transactions with the reserve bank.
Australian Bankers Association chief Anna Bligh said there is no doubt the policy was rushed into the budget at the last minute as a “smash-and-grab” for more revenue.
“It seems not only were banks kept in the dark on this tax, but perhaps Treasury officials had been kept in the dark up until now,” she said after the meeting in Canberra
Ms Bligh said the banks would be given until Monday to make submissions before being handed draft legislation on Wednesday and offered 24 hours to respond.
“This is proceeding with indecent haste and policy mistakes are almost inevitable in that context,” she said.
“This is a government now playing fast and loose with Australia’s financial system and this is a dangerous place for us all to be.”
Ms Bligh said bankers are angry about the tax and insulted by the haste.
Asked if the banks would mount a mining tax-style ad campaign against the tax, she said: “The banks will continue to prosecute this issue in a number of ways.”
Treasurer Scott Morrison has rejected claims he’s at war with the banks over the $6.2 billion tax.
Mr Morrison described the 0.06 per cent levy as “modest” as he confirmed the impost would be permanent, and not just a temporary budget repair measure.
He said the new levy was consistent with similar taxes on banks “all around the world” and would ensure a strong, fair and competitive banking system.
“If the banks want to send a message to Australia, that they want to horde this level of profit to themselves and not do their fair share to support budget repair, they can make that decision,” Mr Morrison told 2SM Radio.
Mr Morrison has urged bankers to not pass on the levy to customers through higher loan rates.
However, Ms Bligh said telling banks to absorb the tax was code for eating into profits which would otherwise go to shareholders.
“Who are the shareholders of Australian banks? They are hundreds of thousands of individual Australian shareholders – many of whom are retirees – who are living on share dividends as a result of their retirement.”
The biggest shareholders of Australian banks are the super funds of all Australians, Ms Bligh said.
“If you are a working Australian and you have a superannuation account, then you own shares in one of the major banks in Australia, and the treasurer is saying this tax should be passed on to your investments.”
Ms Bligh called on the Senate to carefully scrutinise the proposed law underpinning the tax, potentially delaying its July 1 introduction.
Elsewhere, several crossbench senators have joined calls for an investigation into how the budget’s controversial bank levy was leaked to the media, leading to a $14 billion wipeout of bank shares.