Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Treasurer. Would a small or medium business with a million dollars or more in its chequing account at Westpac to cover wages and working capital be obliged to pay the new deposits tax?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the shadow Treasurer for her question. All deposits over a threshold level would attract the fee—let’s be very clear. Why is this the case? Because it just ensures that banks do not get a free kick for the guarantee, and it also addresses the concerns that those opposite said they had about the impact on the short-term money market. This does give very considerable benefit to the banks. The commercial reality is that this fee will reflect funding costs, and it is there to be charged to provide some competitive neutrality out there and ensure that funds have a choice about where they go. But we have a comprehensive guarantee. Those opposite now oppose it. It is clear for all to see. They propose a situation where 40 per cent of deposits would no longer be covered by their support. They deserve to be absolutely condemned, and now they have come up with the extraordinary proposition that the banks get a huge free kick. Not from this government.