Nick Xenophon (SA, Nick Xenophon Team) Share this | Hansard source

by leave—On behalf of the Nick Xenophon Team I move the requests on sheet 8166 together:

(1) Clause 4, page 3 (lines 7 to 9), omit subclause (2), substitute:

(2) The total liabilities amount for a quarter in relation to an ADI is:

(a) if the ADI is a foreign ADI (within the meaning of the Banking Act 1959)—the amount equal to the total liabilities of the ADI and its related bodies corporate (within the meaning of the Corporations Act 2001) for the quarter (excluding any liabilities to each other); or

(b) in any other case—the amount equal to the total liabilities of the ADI for the quarter;

as reported under an applicable reporting standard.

(2) Clause 5, page 3 (lines 20 and 21), omit paragraph (2) (a), substitute:

(a) the amount equal to the total liabilities of the ADI for the quarter, as reported under an applicable reporting standard; and

(3) Clause 6, page 4 (line 18), omit "paragraph 5(2) (b)", substitute "(5) (2)".

(4) Clause 7, page 5 (lines 19 and 20), omit "subsection 4(2), paragraph 5(2) (b) or subsection 6(2)", substitute "subsection 4(2), 5(2) or 6(2)".

(5) Clause 8, page 5 (line 28), omit "subsection 4(2), paragraph 5(2) (b), or subsection 6(2)", substitute "subsection 4(2), 5(2) or 6(2)".

Statement pursuant to the order of the Senate of 26 June 2000

These amendments are framed as requests because they are to a bill which imposes taxation within the meaning of section 53 of the Constitution. The Senate may not amend a bill imposing taxation.

Statement by the Clerk of the Senate pursuant to the order of the Senate of 26 June 2000

As this is a bill imposing taxation within the meaning of section 53 of the Constitution, any Senate amendment to the bill must be moved as a request.

I raised these issues in the context of my second reading contribution earlier today. I can indicate that these requests would ensure that the provisions of the Major Bank Levy Bill would also apply to foreign banks that have significant assets of over $100 billion in terms of their global assets. What this would mean is that banks such as HSBC, ING and BNP Paribas would be liable for this levy in terms of their Australian liabilities. I think it would lead to an unfair and uneven playing field if foreign banks got a free kick on the bank tax. We heard the evidence that was given to the inquiry just a few days ago.

The major banks have set out—as I did in my second reading contribution—the reasons why this particular levy ought to apply to the foreign banks. They will get a strategic competitive advantage over the major banks, and I believe that is fundamentally unfair. We are looking at three foreign banks active in Australia whose global liabilities are well over the government's $100 billion threshold. ING has something like $794 billion in liabilities. Banque National de Paris has 1,971 billion—close to two trillion—euros in liabilities. HSBC has over 2,000 billion British pounds in global liabilities. A bank levy of six basis points on all foreign banks on their Australian liabilities would be in the order of about $180 million per annum. A bank levy of six basis points on all foreign banks under their Australian assets would be in the order of $228 million per annum.

This is something that I think would be equitable and fair. I know that there does not appear to be much support in the chamber for this, but I have yet to hear a good explanation as to why the foreign banks should be exempt from this and major Australian banks should be put at a competitive disadvantage.