The Australian Bankers’ Association has written to dozens of senators requesting proper parliamentary scrutiny of the Turnbull government’s $6.2bn bank tax, saying it is too significant to be rushed through parliament.
It has accused the Coalition of deliberately limiting the time its contentious bank tax can be scrutinised by a Senate committee and says regulators and the Reserve Bank need more time to understand its implications.
David Gonski, the chairman of ANZ Bank, has also called for the level of the 0.06% bank tax to be enshrined in legislation so it cannot be increased in the future without agreement from both houses of parliament.
The ABA, which represents the major banks, has written to dozens of senators complaining about the Turnbull government’s handling of the bank tax.
It says the five banks that will have to pay the tax – the Commonwealth Bank, Westpac, NAB, ANZ and Macquarie – were only given 39 hours to comment on the draft legislation before it was finalised on 19 May.
It wants the Senate economics legislation committee to have the proper opportunity to subject the legislation to “rigorous analysis”, including a detailed regulatory impact statement, before the bill is passed through parliament.
It has also accused the Coalition of deliberately limiting analysis of the legislation.
It says government senators moved a motion on 10 May requiring that any time-critical bill from the budget that is due to start on 1 July (which includes the bank tax bill) be automatically referred to the relevant committee with a reporting date of 13 June.
Given Senate estimates hearings will not end until Thursday next week, it is unlikely the Senate economics committee will have time to hold appropriate public consultations before the 13 June reporting date, the ABA says.
“We are concerned this motion impacts the Senate’s ability to vote on major revenue legislation given there has been no independent scrutiny or guidance,” the ABA letter says.
It marks a further increase in tension between the banks and the government, coming a day after the Commonwealth Bank’s chief executive, Ian Narev, attacked the government during a business lunch in Perth on Wednesday.
Narev said the government’s argument that its $6.2bn tax could be “absorbed” by the banks was senseless and it was only targeting the banking industry because it was successful.
Gonski, has also broken his silence on the bank tax, writing to shareholders to say he is disappointed but accepts the tax will pass into law, given its support in parliament.
As well as calling on the level of the 0.06% bank tax to be enshrine in law, he says the tax should also have a sunset clause where it is extinguished when the federal budget is returned to surplus, and any future proposed adjustments should be referred to the Council of Financial Regulators.
“The bank tax is further evidence of the breakdown in the banking industry’s relationship with many in the Australian parliament and the broader community,” he wrote.
“I want to assure you that ANZ has been working hard to ensure that community trust in banks reflects the crucial role we have in keeping our economy strong and secure.
“This includes our positive and constructive approach to recent parliamentary inquiries and to dialogue over the introduction of this tax,” he wrote.
The ABA has backed Gonski’s call for the level of the 0.06% levy to be enshrined in legislation.
On Tuesday, Deutsche Bank and Morgan Stanley analysts warned the Coalition may have to increase the level of the bank tax if it wants to collect its revenue target of $6.2bn.
They said revenue collected by the government’s bank levy could fall half a billion dollars short this year.
