Treasurer Scott Morrison has delayed the first payment of the controversial bank levy and argued that any added costs will be no excuse for the big lenders to alter mortgage or deposit rates.
In his second reading speech on the Major Bank Levy Bill in Parliament House, Morrison said the first levy calculation and instalment will be postponed by three months with the first payment now occurring on 21 March 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 installment will be delayed by three months – at no cost to revenue – to provide additional time for banks to make necessary systems changes,” he said.
This means that the banks will have to pay for both the September and December quarters for 2017 on the same day. The levy for the 2018 March quarter will be payable on 21 June while that for the June quarter will be payable on 21 September.
The levy does not give the banks an excuse to increase costs for customers, Morrison added.
“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.”
The Treasurer said he expected 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.”
However, CEO of the Australian Bankers’ Association (ABA) Anna Bligh has said that these costs will already be passed onto the public regardless.
“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. It is a concession at last and an acknowledgement from the government that this is a tax on all Australians,” she told the media.
“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.”
Commenting on the changes made by the Treasurer today, Bligh said the government “has been forced to make some concessions” with the banks as both parties attempt to understand the underlying complexity of the levy.
“Banks have been telling the government for three weeks that this is complex and they need to get it right,” she said.
In his speech to Parliament, Morrison also effectively said the levy would not be raised, keeping the level at the previously proposed 0.06% per annum for any eligible licensed entity liabilities at the big five banks.
