A Flood of Criticism That Broke the Levy
by Dr. Andrew D. Schmulow and Dr. Patrick McConnell
Opinion Pieces, (2015), published electronically.
The Federal government announced this week that it will not proceed to introduce a deposit levy on Australian bank customers. Just as well. As ideas go it was both ill-advised and unnecessary.
First of all, Australia does not have a high rate of savings. Taxing savings is hardly sending the correct message, therefore. And especially from a government whose core philosophies are belt-tightening, paying off debts, and living within our means. In fact as messages go, this one was to be deeply counterproductive.
Secondly, it was not needed. Not even for its stated purpose of funding a depositor bail-out fund. Australian depositors will not, in all likelihood, need taxpayers to bail them out in the event that an Australian bank becomes insolvent, and for two reasons.