Bank super tax proposed

The Greens are pushing for a levy on the assets of big banks. The party proposes a new tax of 0.2 per cent on banks with assets of more than A$100 billion.

The Greens project that the bank super-tax would raise $8.4 billion over three years.

The party said that the levy "would deliver funding to give job seekers a living wage, and ensure children living in single parent families do not go without."

The Greens' platform outlines the use of an additional $35 billion, garnered mostly from business taxes, to pay for new spending on education, welfare and the environment.

According to their policy, "[Australia's] big banks are making record profits, around A$24 billion in the past year."

"These record profits, off the back of consumers, are underpinned by an implicit 'too big to fail' guarantee from the government. If the banks went to the wall, the taxpayer would bail them out.

"The big four banks are taking all of the profits, while the taxpayers are wearing all of the risk.

"Based on similar levies in Europe and the United States, the Australian Greens propose a 0.2 per cent levy on bank assets in excess of $100 billion, which will raise $8.4 billion over three years.

"Because it only applies to the big four banks and not their competitors, competitive pressures will stop the big four passing the levy on to consumers. It is time the big four banks paid a fair contribution for the public support they receive," said the Greens' policy statement.

Ross Buckley, professor of international finance at UNSW wrote in a recent paper for the Lowy Institute that "the IMF [in 2010] recommends that governments impose a levy on the assets of their financial institutions. In its words, 'expecting taxpayers to support the [financial] sector during bad times while allowing owners, managers and/or creditors of financial institutions to enjoy the gains of good times, misallocates resources and undermines long-term growth'."

"France, Germany, and the United Kingdom imposed levies in 2011 to recoup some of the costs of bailing out their financial sectors in the wake of the GFC, " among other reasons.

"Bank levies are an attempt to redress these issues, and will help," Buckley wrote.