A Western Australian bank levy is still not completely off the table with comments by Treasurer Ben Wyatt implying that certain progress would have to be made in other areas before the measure is scrapped.
In his state Budget speech on Thursday (7 September), Wyatt said that while WA would not implement a state-based bank levy right now, issues with the current taxation system especially around GST mean that it could be introduced in the future.
“The failure of the GST to provide the expected returns to Western Australian taxpayers means this government must continue to consider alternative revenue measures to make up for this GST shortfall. We will continue consideration of a state-based major bank levy in the absence of genuine GST reform or our parliament not passing other revenue measures.”
State-based bank taxes, which were given up with the introduction of the GST in 2000, would have raised around $300m in 2017-18 for WA, Wyatt said.
“A bank levy, similar to that announced by South Australia would, if implemented in Western Australia, improve our net operating balance by around $250m in 2017-18.”
Anna Bligh, chief executive of the Australian Bankers’ Association (ABA), said that the decision not to move ahead with a state-based bank levy showed “laudable economic discipline and foresight”.
“It is clear the WA Government understands it must remain an attractive and competitive place to do business,” she said. “The ABA urges the WA Government to maintain sound economic policy and not put the bank tax back on the agenda.”
She also called upon the South Australian government to follow WA’s example and discard its plans to bring in a state-based bank levy before it damaged the SA economy.
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