Could banks face super-profits tax?
By
Kevin Eddy
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23/06/2010 12:00:00 AM
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2
comments
The Prime Minister has played down fears that other sectors could face a mining industry-style 'super-profits' tax.
Kevin Rudd maintained that the tax would remain "unique to the resources sector" after comments from Treasury Secretary Ken Henry implied that the tax could be rolled out to all companies - including banks - as part of a long-term reform agenda.
Henry's recommended at a tax conference in Sydney that lowering the company tax rate towards 25 per cent should be a short-term target, eventually Australia would need a better method of taxing companies. He suggested that companies would be able to earn up to the government bond rate tax-free, but would then pay a heavier tax on 'super-profits' above that level.
The idea of extra levies on banks is one that has gained traction around the world in recent months as a reaction to banks' roles in the GFC. The UK, France and Germany all announced plans to tax banks operating in those jurisdictions yesterday.
Latest Comments
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Wayne on
23 Jun 2010 12:06 PM
If our banks had not been guaranteed by the government during the GFC they would have found life very difficult rolling over their debt like banks in the rest of the world. A bank produces nothing other than pumping out credit and increasing our reliance on debt. the more they pump out the bigger the nations debt and the harder to pay back. But the banks thrive on it. So yes, a super profit tax on banks would be just fine - putting something back to the people who backed them during the GFC is only fair. Can you hear them scream??
At least miners do something productive - pity they don''t add value to the product instead of just digging and shipping.
Kevin on
23 Jun 2010 12:28 PM
Why doesn''t the government do something smart for a change, the tax rate should depend on what the miners do with the minerals - if they want to simply dig it up and send it overseas charge them the top rate, if instead they process and value add (creating work for more Australians & more income tax/less benefits for the government) the rate should be reduced - the more value adding the lower the rate