It’s a plan that’s light on detail for the moment, but it might catch some voters’ interest.
A fledgling political party wants tax penalties on banking profits that would be determined by a government body reviewing their funding structures.
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The Bank Reform Party said today it would seek to “confidentially review” the funding costs of major banks “to determine if these costs were honest or not”.
Details on how these reviews would work were scant in today’s statement but banks found to be beefing up margins by not passing on reductions in funding costs to consumers would be hit with a “gouging tax”.
But the party admits it can’t get the banks to “whip up their skirts”.
“The gouging tax is a speed camera, if the bank’s don’t speed they don’t get caught; it’s a powerful incentive for them to do the right thing by Australian taxpayers by pulling them back into line,” BRP leader Adrian Bradley said.
“The independent panel will be responsible for ensuring the banks can continue to operate profitably while protecting the interests of the wider Australian community, not just bank shareholders.”
For banks, failing to pass on RBA rate cuts in full has become a continuing political headache. Commonwealth Bank chief executive Ian Narev admitted as much last month, telling analysts: “We’ve got to keep focused on the right balance between mortgage customers’ needs, deposit holders needs and the needs of 800,000 Australians who own the shares directly and millions more through funds and realise at any given time one or more of those group of stakeholders are going to hate us.”
The revenue from the BRP’s tax would be used to fund a “People’s Bank” and “other community programs”, the party said.
Bradley told Business Insider the structure of the review group was yet to be fully determined but that it would sit “somewhere between the RBA and APRA”.
He could say the review group would include “subject matter experts” and its work would remain confidential.
“Obviously, we can’t get the banks to whip up their skirts,” Bradley said.
The party plans to run candidates in the 2013 federal election, including in Treasurer Wayne Swan’s seat of Lilley. Bradley said there were now an estimated 1200 members.
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