ABA CEO keynote address to the Trans-Tasman Business Circle Annual Economic Forecast Luncheon 2026  

Good afternoon and thank you to the Trans-Tasman Business Circle for the invitation to speak today. 

I want to welcome you all here today for this event and the critically important subject I will be talking about, the emerging contribution gap between Australia’s domestically domiciled company and the rise of big tech.  

It is a timely moment to take stock. 

In recent years, disruption has become the new normal. 

Conflicts in Europe and the Middle East, and the fracturing of the diplomatic order are reshaping trade, investment and supply chains in ways that are causing economic upheaval and cost of living pressure in many households.   

At the same time, the pace of technological change, particularly in artificial intelligence, is raising new questions about productivity, jobs and how our institutions and its employees adapt. 

The question every country faces is not whether disruption will arrive, but whether the institutions that underpin economic life are strong enough to absorb it. 

With disruption the new normal, resilience is becoming the new imperative. 

And resilience is not free. It has to be built, funded and defended. 

Historically, Australia has weathered global storms relatively well – and the banking system has been a large part of why. 

We navigated the Global Financial Crisis without a single bank failure. With some of the strongest capital buffers in the world, banks sustained households and businesses through the COVID-19 pandemic. When natural disasters hit – bushfires, floods – banks are among the first to respond, with hardship relief, emergency funding and support deployed into devastated communities. 

Most recently, banks have partnered with Government to offer $1 billion in zero interest loans to Australian businesses through the Economic Resilience Program. 

That support will help businesses manage supply chain disruption and rising fuel costs to keep Australia’s industries moving. 

And alongside that, the Australian Banking Association has launched a national campaign with a simple message to customers and small-business owners: don’t tough it out on your own. Banks stand ready to offer financial support to those who need it. 

Bank’s capacity to step up amid crises is the product of a healthy, profitable and well-capitalised sector.  

Today, the daily barrage of cyber-attacks, multinational fraud and financial crime mean that major threats are omnipresent.  

Round the clock investment is required to keep safe Australia’s financial systems and Australians’ money.  

It is not just the pursuit of a strong, safe banking system that makes Australia reliant on our banks. The ability to fund our public services relies on profitably banks too. 

In financial year 2025, Australia’s largest banks paid over sixteen billion dollars in taxes and levies. Banks paid an effective tax rate of 40 per cent, once you add the Major Bank Levy, unrecoverable GST, payroll tax, and numerous regulatory levies. 

Australians rely on that tax being paid. The sixteen billion dollars of tax paid by banks is equivalent to the cost of 373 million bulk-billed GP appointments. Or 160 days of the entire aged-care system.  

Banks are among the largest corporate taxpayers in this country – second only to mining. And unlike some sectors, the vast majority of bank earnings stay here.  

Sixty-three per cent of bank income is paid straight back as interest to depositors. Eleven per cent goes to wages – to the nearly 180,000 Australians our members employ directly. Seven per cent flows to dividends, overwhelmingly into the superannuation accounts of everyday Australians. What remains is reinvested in bank capital, which is a necessity if banks are to keep growing lending to support our economy. 

And the public service contribution extends well beyond tax paid. Banks spend $23 billion a year with Australian suppliers. They have invested more than $2.5 billion fighting financial crime and scams. They spent $2 billion building the New Payments Platform, $1.5 billion developing the Consumer Data Right and $100 million rolling out Confirmation of payee to protect customers from scams.  

In exchange for the privilege of serving Australian households and businesses, banks submit to rigorous oversight, invest in the system, and contribute to the community. 

However, there are growing risks to the public benefit contract between banks and Australian society. 

Disrupters benefiting from regulatory imbalance threaten not only profits, but as a result threaten government tax revenue, payments to superannuation funds, and investment in Australian owned financial infrastructure. 

Over the past decade, large foreign multinationals – global technology platforms – have moved aggressively into payments and financial services in Australia. Digital wallets, Buy Now Pay Later providers – these now sit at the centre of how millions of Australians pay for goods and services every day. 

Much of this has brought genuine benefits: innovation, convenience, choice. And banks welcome competition. 

But the companies providing these services operate largely outside the regulatory framework that governs Australian banks. They are not held to the same consumer protections. And they are not making anything like the same contribution to the Australian economy. 

The numbers are stark. According to the latest ATO data, Apple paid just $154 million in annual corporate taxes while reporting $12.4 billion in revenue in Australia. That means Apple – whose market capitalisation is seven times that of the ‘big four’ banks combined – paid less corporate tax over an entire year than major banks paid in a fortnight.    

Consider the experience of a small retailer paying to accept payments. A foreign-owned Buy Now Pay Later provider charges that business roughly eleven times the fee of an Australian bank-issued debit card. That is revenue extracted from Australian small businesses, by companies headquartered overseas, subject to minimal oversight, and contributing almost nothing back. 

And while those fees remain unregulated, the Reserve Bank recently announced further cuts to the revenue banks earn from payments, called interchange. Interchange funds the infrastructure that keeps payments running: fraud detection, system upgrades, the security architecture that protects every transaction.   

Herein lies a very stark example of regulatory imbalance. When you double click your iPhone to make a payment, the amount the bank gets from that payment is capped yet the amount Apple can claim is uncapped.  

While many of us have welcomed the convenience, Apple makes effective competition on their hardware almost impossible by blocking fair access for competing digital wallets. 

Payments infrastructure isn’t getting any cheaper to maintain, yet Australian banks face the prospect of having less revenue available to fund it – while a growing share of revenue is siphoned off to companies in Silicon Valley. 

Today we are releasing a report that sets all of this out in detail. It is called The Contribution Gap: Tax and Regulatory Imbalances in the Digital Age. 

It documents what Australian banks contribute to the economy and to the communities they serve. It lays bare the growing disparity between those contributions and the obligations carried by multinational tech giants. 

The contribution gap matters for a reason that goes directly to recurring theme in the face of crises – resilience. 

If Australia’s resilience depends on institutions that are willing to pay their fair share of tax, invest in infrastructure, sustain lending through downturns, deploy hardship relief after disasters, fight scams and fund the payment systems that keep the economy moving – then the system those institutions operate in must be sustainable.  

You cannot load one set of participants with the full weight of regulation and taxation, while allowing others to free ride, and expect the foundations to hold indefinitely. 

Let me dwell on the fiscal dimension for a moment, because it deserves more attention than it typically receives. 

If the contribution gap continues to widen, the consequences will be dramatic. There will be less tax revenue for public services. Fewer jobs. A gradual erosion of consumer protections. And a tilted playing field that rewards revenue going offshore over genuine investment in Australia. 

When large foreign multinationals generate billions in revenue from Australian consumers but pay a fraction of the tax that domestic institutions pay, the result is fiscal leakage. Revenue that should be funding schools, hospitals, aged care and infrastructure leaves the country instead. 

This is happening at a time when the federal budget is under genuine pressure.  

While not dead, OECD efforts to create minimum global taxation rules have faced an uphill battle. The battle against diverted profits and avoided tax necessitates ongoing action. 

Governments will not be able to maintain services if a growing share of value generated from Australian consumers flows to foreign headquarters rather than circulating through domestic wages, tax receipts and infrastructure investment.  

The risk is one of a vicious cycle. Unbalanced regulation allows multinational players to keep growing their share of Australian revenue, while paying lower taxes. The more commercial revenue that shifts to these players, the greater the revenue deficit created for government. 

Ensuring a regulatory level playing field and closing tax avoidance are equally important and closely related tasks for government. 

When the need for resilience is growing, not shrinking – a growing revenue deficit is a vulnerability Australia cannot afford. 

This is ultimately a question of economic sovereignty. 

Australia’s prosperity has always depended on the strength of its institutions. In a world that is becoming less stable, less predictable, and more contested, that dependence will only grow. 

A healthy, domestically anchored banking system is critical to our nation’s success. 

The compact that sustains it must be fair. If Australian banks are held – rightly – to the highest standards, then global technology and payments companies moving in the same space must be held to comparable standards too. Same activity, same risk, same rules. 

Australia’s future prosperity does not just rely on banks doing their part. It requires that every institution profiting from our economy bears its fair share of the weight. 

That is the contribution gap. And closing it is the work ahead of us. 

Thank you.