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A$6 billion budget policy bites in bank profits

A$6 billion budget policy bites in bank profits

(10 May 2017 – Australia) The “Big Four” banks in Australia, with the addition of Macquarie Bank, have been hit with a new, multi-billion- dollar levy as well as a suite of increased controls and penalties imposed by the federal government.

The levy, which will total A$6.2 billion over four years, will be aimed at Westpac, ANZ, Commonwealth Bank (CBA) and National Australia Bank (NAB).

Banking association CEO, and former Queensland Premier, Anna Bligh has been critical of the revenue raising policy, saying: “This is bad policy, it's policy on the run and every Australian is going to have to pay the bill.”

“Any Australian who has money in a superannuation account, any Australian who has a retirement income that's linked to the value of banks because they are the biggest investors in banks will be affected.”

Bligh added that the Government did not consult with the industry prior to the Budget announcement, and said she believes the policy framework or tax architecture simply does not add up.

Treasurer Scott Morrison said the new levy is part of a broader package aimed at improving accountability and competition in the banking sector.

“This represents an additional and fair contribution from our major banks, is similar to measures imposed in other advanced countries, and will even up the playing field for smaller banks,” Mr Morrison said.

The revenue will be directed towards budget repair, the treasurer said.

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