(1 April 2008 – Australia) The Australian Bankers’ Association (ABA) has backed the Federal Government’s decision to exempt financial service providers from component pricing requirements.The objective of the component pricing requirements is to ensure that customers know the full cost of a good or service which is advertised, instead of just one component of the price.
In backing the stance taken by the Federal Government, chief executive of the ABA, David Bell, said that the ongoing nature of banking makes it much different.
He said that banking products, including deposit accounts and variable rate loans cannot be precisely measured by dollar value.
He said that it was difficult to predict what the spending and transaction habits of customers may be because they are dependent on the future choices that customers make.
There is a precedent for treating financial services differently – the Goods and Services Tax (GST) regime input taxes financial services, in part, because credit interest rates cannot be treated like prices.