The taxation of savings as well as options to replace specific taxes such as those on insurance will be up for discussion at the Tax Forum the Australian Government plans to hold over two days in the first week of October.The Treasurer, Wayne Swan, released a discussion paper on tax reform yesterday that largely recaps, in brief, the key issues raised in the lengthy "Henry" review of taxation prepared in late 2009 and made public in May 2010.As with most businesses, the issues for banks at the forum will concern the debate over tax reform priorities. The focus will be on taxes' contribution to lifting productivity, as well as increasing the efficiency of the existing tax mix.The discussion paper highlights these issues, citing analysis in the 2009 tax review of the marginal welfare losses from various classes of taxes, of which two that impact directly on the financial services industry (insurance taxes and stamp duty on conveyancing) fare poorly.The discussion paper notes that "insurance taxes are an inefficient way of raising revenue and can disproportionately impact on some sections of the community, such as those on low incomes." So far, though, the federal and state governments have shown no great interest in tackling proposals to replace insurance taxes, which account for eight per cent of tax revenue collected by state governments.Some taxes specific to the banking industry are already the subject of reform.A 50 per cent tax discount on interest income is being phased in, and capped, from next year.The Government is also phasing out interest withholding tax for financial institutions.There appears to be little interest in overhauling the good and services tax, meaning the present approach of input-taxing banking services, rather than taxing the value-added in banking, will continue.Other tax topics relevant to banking that have been of recent interest to Treasury did not rate a mention in the discussion paper.For example, in October 2010, internal documents (since released under Freedom of Information laws) sent to the Treasury secretary concluded that "it can be argued that there is a strong case for charging the banking sector for the implied systemic guarantee provided by the public sector." The Insurance Council of Australia received an invitation to nominate a representative to the Tax Forum, but the Australian bankers Association missed out.