Think tank projects how much the bank levy will cost Australians

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As Scott Morrison continues his war with the big banks, one prominent think tank has calculated how much the Federal Treasurer’s bank levy will cost the average Australian.

The Australia Institute (TAI) has worked out that, should the big banks pass on the cost of the Federal Government’s bank levy, announced in Budget 2017/18, Australians will be less than $10 per year out of pocket.

The banks have said they would pass the cost of the levy onto shareholders through reduced dividends. So the average superannuation balance would be $7 worse off each year.

Most Australians with a super account are shareholders in banks through their super fund investments. TAI’s study reveals that, in 2015/16, the average super balance held around $3141 worth of shares in the big five banks, and received around $161 in dividends.

If the banks passed on the levy to customers, it would cost them about 60 cents per month.

Scott Morrison has been calling on customers to ditch their banks if they pass on the levy. TAI’s report revealed that if customers were to move to a smaller bank, they could save $6,096 in interest per year (based on the average mortgage amount).

“Ironically, if the banks choosing to pass on the levy to customers led to people shopping around, mortgage holders could be big winners,” said TAI’s Senior Economist Matt Grudnoff.

Mr Grudnoff also said that if the banks want to benefit from a government guarantee that they would be bailed out of financial difficulty, then they should have to pay for this insurance.

Mr Morrison says it’s necessary for the banks to accept the levy to support schools, hospitals and pension payments.

“Many other Australians have had to deal with some hard decisions we have had to make over the last four years,” said Mr Morrison. “It’s a fair levy, it’s a reasonable levy, it’s in place in other countries around the world and it’s also a levy that banks are in a position to support.”

Read more at The Australia Institute

Do you think this is fair? Should the banks just swallow the cost? Or are you happy to lose $10 per year to support spending elsewhere? Isn’t this just another tax on us?

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Written by Leon Della Bosca

Leon Della Bosca is a voracious reader who loves words. You'll often find him spending time in galleries, writing, designing, painting, drawing, or photographing and documenting street art. He has a publishing and graphic design background and loves movies and music, but then, who doesn’t?

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98 Comments

Total Comments: 98
  1. 0
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    Mr Morrison said it was a bank levy. What don’t the banks understand? It is for the banks to pay from their profits not for them to keep all their profits and put the levy on their customers.

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      Mr Morrison needs to stipulate that the levy has to be paid out of their yearly profits.

    • 0
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      Hello? Any one there? This is Australia, not North Korea! The government can’t (and shouldn’t) try to control how a company operates it’s business. I think this tax (levy) is so wrong and when the government starts picking on certain sections of the business community just because they are an ‘easy’ target we have real problems! YES! The banks make big profits but they are a legal, legitimate business and no section of the business community should be targeted for a NEW TAX just because the government thinks the public resents the profits they make. It can only come from one of two sources – either they cop it and it comes out of their profits and is therefore paid by their shareholders or they pass it on to their customers through higher interest rates or increased charges – either way Joe Public pays, either through their superannuation or through increased bank costs. If you don’t like the company take your business elsewhere, don’t call out for the government to control how they operate! We don’t need more taxes, we need to reduce spending and BOTH sides of government should get together (a pipe dream, I know) and work HARD at ways to reduce the cost of government for the Australian people instead of this ridiculous attempts at point scoring against each other in the hope of winning the next election! It won’t matter which side wins, if they don’t co-operate on this we are headed “down the Gurgler” and I despair for this country and its people.

  2. 0
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    Just another TAX in disguise!
    I’m sure that ScoMo knew this all along!

  3. 0
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    What’s this ‘IF’, White man? Why would you ever imagine it would be any other way?

    • 0
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      It’s exactly like all the privatisation ventures – another burden on the tax payer and the government still gets taxes out of its share and direct taxes etc.

      NEVER trust a government with a policy involving money.

    • 0
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      TREBOR you certainly do a lot of winging how do you you think the Government are going to pay you pensioners without other taxes or are you prepared to take a little less welfare?

      All pensioners just keep putting there hand out for welfare that is why people call them bludgers.

    • 0
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      First of all, Roby – we don’t disparage our fellows here with terms like ‘whinging’ – though you could learn to spell the word before using it.

      What are you? Fifteen years old?

      The government will pay for pensions and other core Social Security out of the tax that has gone into consolidated revenue for fifty years of the working life of pensioners who’ve contributed mightily to this nation. You obviously have difficulty keeping up with reality.

      Pensioners do not receive ‘welfare’ – they receive the return on their contribution to which they are entitled, so don’t you even begin to consider the term ‘bludgers’, you guttersnake piece of excrement.

      Thank you for coming – now make us all happy and leave. Some bring happiness wherever they go – some bring happiness WHENever they go – you are of the latte stamp.

    • 0
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      It was always a forgone conclusion that it would be passed onto the banks customers. Like I said before all we are able to do if we feel strongly is to move to the small banks endeavour not to support the big 5 banks or get over it.

    • 0
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      Can’t take a bit of your own bullsh-t TREBOR I have been on this web sight for years but just don”t comment much as most of you are on Government handouts and boy you cap it off as the biggest winger of all.

    • 0
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      TREBOR you don’t think your comment to Roby is disparaging???

    • 0
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      You started the insults, Roby – now get off with you. You don’t think enough to offer comment – and my comment was intended to be disparaging to this ghett for his insults.

      Can’t take it – don’t hand it out, children, and keep your discussion within the confines of decency and reason – or accept the consequences.

    • 0
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      Cracking me up TREBOR 🙂 you are so contradictory.

    • 0
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      Nothing contradiction in it – now go back to the lesson for today. I’m good for a laugh often – but not that kind of laugh.

    • 0
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      You know what, I’m going to let this go because its just too funny.
      Spell check alert (as you do to others) do your mean contradictory??????? Hate when people correct my spelling because they have nothing better to pick on or want to insult your intelligence but I just can not help myself this once 🙂

    • 0
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      Ah – I corrected poor old Roby the Union hater’s use of words- not yours – never had an issue with your command of the English language. You seem intelligent and articulate, if somewhat paranoid…

      Now Roby has us assured that credit unions will only funnel your money back into Unions, who naturally – to Roby – are all scumbags.

      Who’d’ve thunk that!!

    • 0
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      TREBOR now you can”t even read you oaf I said union Super funds not credit unions give money to the Unions man are you just plain slow ?

    • 0
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      Poor old Roby – his English is so limited he has to revert to three letter words…. ‘oaf’ .. not something anyone would call such a fine, svelte, upstanding figure of a man with a high intellect and articulacy…

      (sorry about the big words)….

    • 0
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      Why drag Union super funds into discussion of Credit Unions, then, Robespierre?

      Try to maintain a straight line…

      You really are side-tracking discussion here, old boy.. let’s get back on track, shall we?

      If we need side-tracking we can summon OG or Bonny by the use of some arcane mystical ceremony….

      Now – what do YOU think the banks will do in response to being asked for a minute fraction of their profits to ‘assist in the budget emergency’?

      I predict they’ll find a new fee that will more than compensate them for it, and apply that, so the imposition on the end user will be higher than at first thought.

      We see that process with government agencies raising fees (undeclared taxes) and ‘privatised organisations’ raising fees if they can’t raise direct cost charges….. why would the banks be any different?

    • 0
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      TREBOR old boy I had a lot of other words I could have used but I get kicked off this web sight a lot so I did not want to upset you lefties to much this being a left wing web sight.

    • 0
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      Now I wonder why you’d get kicked of this web site and others? Nothing to do with your personal vitriol, is it?

      Amazing prejudices you have on board there, old chap – it seems that, to you alone, people who discuss or oppose anything are ‘whingers’, that all pensioners are bludgers, that all Unions are crooks, and that any site open to discuss issues is a ‘leftie’ site.

      You forgot to include that the ABC is a hotbed of leftist propaganda….

      Dearie me – take two bottles of scotch and call me in the morning…. once you wake up you will find it a different world out there.

  4. 0
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    Who would know. Not as if the banks are going to tell anybody is it and I am not sure the public or government will be able to find out.

    • 0
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      Again we agree MICK. Yes, there will be a cost on customers, no, there will be no difference to shareholders. This proposed tax is quite small, 0.06%, and as banks raise interest rates without the Reserve bank moving theirs, it will be ever so simple for banks to announce an interest rate hike. Of course, the rise will have nothing to do with the new government tax, it will be because of “market forces”.

  5. 0
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    Roby your comment is way out of line ,I suspect you support this corrupt Government.

    • 0
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      I suspect Roby lacks the intellect and even knowledge to even do that.

    • 0
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      I know all welfare reciptients are left wingers so I don”t support those fools who wish to bankrupt this country.

    • 0
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      So exactly who are these ‘welfare recipients’ (spelling corrected again)? Pray tell us of your infinite wisdom on the subject so we can all be on the same page…. give us your list so we can pick it apart for you and set you on the straight and narrow.

      We don’t have ‘welfare’ here – we have bought and paid for by generations social security.

    • 0
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      Probably you went from the dole to the pension TREBOR that is WELFARE

    • 0
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      Roby, is being offensive to others the only way you can feel better about yourself?

    • 0
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      No, son – I went from DSP awaiting DVA outcome to pensioned off… now it’s my turn to be a burden on the government.

    • 0
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      Roby, from around 1940 people paid into a compulsory superannuation scheme like they do now, I think it was 7.5%. If you insist that makes the pension welfare then everyone who is paying into a superannuation scheme now will be on welfare when they retire, teachers, nurses…you.

    • 0
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      And I thought Ad Hominem was a gay advertising agency…. oh, well – you learn something every day.

    • 0
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      Oh Triss seriously everyone on here is offensive, read the comments above don’t just pick on one individual

    • 0
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      No they’re not, Trees.

    • 0
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      Ok Triss they are not 😀

    • 0
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      Dearest Trees – I don’t believe I’ve slagged you, and I customarily don’t -but when some upstart comes along and starts to mumble darkly about ‘whingers’ and ‘pensioners are bludgers’… he deserves to be hung by the family jewels…

      It may be that you are simply an overly sensitive soul… don’t take it to heart..

      I rather liked your monicker initially being something of an Old Hippy or whatever myself (never thought I’d see the day) – but your politics… well…. let’s just say nice to have met you.

    • 0
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      Me sensitive? nope I’m not sensitive, I do have opinions & I am happy to share them.

      Politics, the way I see it, it doesn’t matter who is in power the issues will still be the same, nothing is going to change if you just complain on line, I believe one of your comments yesterday was “I have not yet begun to fight” (or similar) well get out there TREBOR & lead the march you obviously are very passionate about the cause.

      You’re an old hippy that is cool, before my time but very cool.

    • 0
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      Ex-military man, public servant and security guy – my suggestion that I was an Old Hippy had capitals on both ‘old’ and ‘hippy’ – inferring that both words went together but held no solid connection.

      I may be an Old Hippy because I plant trees and gardens and such and love doing so – but a hippy I never was.

    • 0
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      Remember that words have power – a phrase I believe came from Naom Chomsky, but was adopted by the feminists to further their views on the use of language in society. So when I add those capitals it actually means something else… and on that other thing – anyone is entitled to a mistake now and then. I was between taking out an air conditioner and an old firebox in renos and had a handy man on an hourly rate here.

    • 0
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      Damn – that’s Noam Chomsky….

    • 0
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      And Trees – I might make the occasional typing mistake – but my spelling is not permanently impaired like some…

    • 0
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      .. or is that sum? Robes? Heemie? Help me out here…. you’re the chief proponents of Anti-English…. heemie, of course, specialises in capital punishment – hardly ever uses them….

  6. 0
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    all this talk ? banks will do, as they’ve always done, they know how to soften the blow for themselves, always have, always will, increases will happen, and the end result is, the customer always pays, it will never change, directly or indirectly, sadly

  7. 0
    0

    My bank has already cut the interest for the GREAT amount of 1.35% to 1% but the Government is STILL deeming all of us to be getting 3.25% so some people will be getting their pensions cut because they are deemed to be getting a darn sight more than the are actually getting

  8. 0
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    Roby the Big End of Town are doing a good job of stuffing this country and for your information I am over 70 and do not receive one cent of Government support, and I still think people on a pension are getting screwed.

  9. 0
    0

    I don’t agree with banks passing onto customers. They have already in the last year increased interest rates on mortgages when the RBA has left on hold. They already have made that money up. Definitely should not be passed onto customers, out of Banks profits only.

  10. 0
    0

    Roby , you really need to become better informed . Current aged pension recipients paid 7.5 % into a government retirement fund for all/most of their working life only to have it stolen and put into consolidated revenue . And you have the audacity to label aged pensions as ‘welfare ‘ . Really !! Wonder how you will react when the government freezes your super and confiscates your funds . Based on government behaviour in the past I wouldn’t be surprised if this was to eventuate in line with a cashless economy. Ageism is alive and well and it’s people like you who perpetuate it with your ill informed nonsense . Karma is a bitch , let’s hope it doesn’t bite you in your hip pocket when you are at the most vulnerable stage of your life .

    • 0
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      Yes, you’re right, Tikitik, it was a complulsory payment into a superannuation scheme therefore it can’t be considered a handout and welfare otherwise everyone who is paying into super now will be considered welfare recipients when they retire.

    • 0
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      Aye they diverted the river into the consolidated revenue dam – but the flow was still the same river….

    • 0
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      I must add that social security doesn’t ONLY cover pensions – the levy was a form of national social security insurance, and was intended to cover all. Politicians shagged it by taking the cash first, then adding extra bits for those without real need onto ‘social security’ until we have a ravening monster – though that monster does NOT include core social security such as pension and unemployment. In pensions I include DSP, but there are many in receipt of ‘social security’ even sometimes by another name that have no genuine need of it.

      THERE is the problem. And let us not forget that social security payments, being of the lowest order in the nation, are rapidly taken up again within the tax cycle, and thus constitute a miniscule, if any, net cost to government – unlike – say – offshoring $130Bn for the pollie’s ‘futures fund’ or paying Frogs of
      Spicks $50Bn to build submarines that could be easily built by unemployed trades people here….. and thus return their income back into the tax cycle via spending….. which clearly is never going to happen with the Frogs and Spicks etc….

      Maybe the government is expecting some ‘trickle-down’ from Spain and France over its spending there….. they’ll be waiting a long time…

    • 0
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      Are those that have Never Worked, never paid Tax and now on the OAP on Welfare?

    • 0
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      Retired Knowall, technically speaking I guess if you have never paid taxes & go the OAP you are still on welfare under a different name?

    • 0
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      No – some people are disabled from birth, and very, very few never work. Like any good insurance policy intended to cover all, the payments do not discriminate.

      That was the way the Liberal party set it up…. now the Anti Liberal party want to turn it backwards…. Bob Menzies would turn over in his grave….

      Technically? Perhaps – but not under the conditions of the policy…..

    • 0
      0

      Trebor from your blogs you never worked a day in your life I worked seven days a week to pay my way you are scum I don’t get nothing from the Government you are the ultimate bludger

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