Labor continues bank levy pedantry

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By Leith van Onselen

Labor’s pedantry over the Coalition’s 0.06% levy on the big banks’ liabilities rolled on for a third day yesterday when it once again used Question Time to discredit the Budget’s forecasts that the bank levy would raise $6.2 billion over the forward estimates.

The Guardian’s politics blog once again broke-down Labor’s shenanigans:

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Geez, this is getting tiring. For once, could one of the major parties please abandon partisan politics and govern in the national interest?

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Seriously, who cares if the bank levy ends up raising $2 billion less than Budgeted? $4 billion in revenue over four years is still far better than nothing, and would at least provide some return on the estimated $5 billion in taxpayer support received annually by the major banks.

Does Labor seriously believe that the banks should pay nothing for their taxpayer subsidies and continue to receive a free ride? Because the way Labor is currently handling the levy debate, you would swear they are in cahoots with the banking cartel.

Cheap political point scoring and tribalism are key reasons why undertaking reform has become next to impossible in Australia. Whenever a government comes up with a sensible policy worthy of bipartisan support, the opposing party almost always rejects it.

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Labor must realise that by trying to scuttle the bank levy, it will make its task of repairing the Budget more difficult when it next takes office. Not only will the revenue from the bank levy not be there, but the Coalition would likely return fire by mounting a campaign against any Labor proposal to raise taxes for Budge repair.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.