30 May 2017
Sydney, 30 May 2017: The legislation for the major bank levy introduced today shows the Federal Government’s original design had major flaws and significant questions remain on how this rushed legislation will affect the economy, the Australian Bankers’ Association said today.
“The Government has been forced to make concessions to the bank levy following the banks’ one and only opportunity to meet with Treasury on such a major Budget measure,” ABA Chief Executive Anna Bligh said.
“Banks welcome the concessions which would have had unintended consequences across the financial system, but despite these changes, major banks remain concerned about the Government’s poorly-designed tax grab,” she said.
The legislation, revealed to the public for the first time today, showed the levy will no longer apply to:
- Derivative transactions, which banks use to minimise their risk.
- Money the banks hold with the RBA.
Banks had argued for both of these changes.
“This is a tax on all Australians even with these changes. The Government’s own analysis released today acknowledges that the impact of this tax could hit “bank borrowers, lenders, shareholders or some combination of these groups”1,” Ms Bligh said.
“This levy will impact on investor confidence in Australia’s major banks and make it more expensive for banks to raise the money they need to lend to businesses and individuals,” she said.
“The major banks’ market value has already fallen by around $39 billion since the Budget.”
Despite these changes the Government still maintains that the levy will raise $6.2 billion over the four years of forward estimates in the Budget.
“Treasury has not provided sufficient modelling to explain their calculations in the Budget. At this stage, we are still uncertain just how much the levy will raise.
“There is no sunset clause which is unfair to those who will be impacted by the tax. One of the rationales for the levy is that it will contribute to budget repair,” Ms Bligh said.
“If that is the case then let’s be fair and remove the tax once the budget is back in the black.”
ENDS
Contact: Stephanie Arena 0477 470 677 or Nic Frankham 0435 963 913
1Regulatory Impact Statement pg 35.
Latest news
E&OE Radio Interview Mix 104.9 Darwin 20 November 2025 Topics: Black Friday scam warning; meta profiting from scam ads. Katie Woolf (Host): Now, we are due to catch up with the Australian Banking Association of Australia, because they’re urging Territorians and indeed, everybody across Australia to stay alert as Black Friday sales kick off with shoppers losing almost $40 million to scams in the past year. And I know that we… Read more »
Lending to Aussie farmers now exceeds $140 billion as banks continue to recognise the integral role agriculture plays in supporting the regions and the wider Australian economy. The ABA has today marked National Agriculture Day, launching its 2025 Banking in Agribusiness report, which shows outstanding credit to Australia’s 170,000 agribusinesses has jumped 80 per cent… Read more »
E&OE Radio Interview 2SM Breakfast 18 November 2025 Topics: Black Friday scam warning; Meta hosting scam ads Tim Webster (Host): Now we’ll remind you about all of this regularly, because there’s too much going on, it’s just not funny and we’ve done it a couple of times already today, and we’ll continue to do it. Shoppers are being urged to be wary of dodgy deals, because the Black Friday sales are pretty much on, and it’s you know, they’re on but there’s no specific Friday. So nearly $40 million was lost to buying… Read more »