Treasurer Ben Wyatt has all but ruled out the introduction of a bank tax in the September budget but has kept the option open for a future decision, while the industry has called on the state government to protect Western Australia’s economic growth by not bringing in the levy.
Mr Wyatt told ABC Radio this morning that he would be keeping a close eye on the South Australian government’s proposal of a 0.015 per cent quarterly tax on bank bonds and deposits before deciding on a similar move in Western Australia.
But if implemented, the treasurer estimated it could raise around $1 billion over four years.
“It’s very much watch-and-see at this point... but something like that may have an impact on business investment – and business investment has declined significantly in WA – and that’s my prime concern, so it may mean that I’ll need some better analysis on that,” Mr Wyatt said.
“I need to be aware of any potential negative downside that moving down this path might have.”
But the treasurer refused to rule out an increase to mining royalty rates in the coming state budget, despite acknowledging that the decision to do so would still mean WA would lose most of the revenue to other states thanks to WA’s low share of the GST carve-up.
His comments followed those of Australian Bankers’ Associated chief executive Anna Bligh, who said a tax on banks would be dangerous for WA’s economy.
“Just like South Australia, WA badly needs jobs and investment,” she said.
“A move like this would significantly impact the WA economy at a time it needs support.
“Banks are talking with all sides of politics in WA to emphasise that a tax on business would be the worst thing for their economy and the people of WA.”
Ms Bligh said the likelihood of SA’s tax on banks was doubtful with widespread opposition across multiple sectors within the state.
“If the tax is defeated in SA, WA would be the only state to distance itself from job creation and investment,” she said.
Mr Wyatt said he also had concerns about being the only state to adopt the bank levy if SA’s tax was voted down.
“That would cause me some concern,” he said.
