In a foretaste of the sort of arguments that are no doubt about to swamp the Financial System Inquiry, the mutual bank lobby is calling for three tax changes that would work to its benefit and one government hand-out to cut sector costs.The Customer Owned Banking Association made the proposals in a "pre-budget submission", but it's likely all four proposed changes will be echoed in the group's submission to the FSI.COBA called for a levy on Australia's four "domestic systemically important banks" (or D-SIBs).The association also wants a capped 50 per cent discount on tax paid on deposits (a perennial industry hobby-horse), a scrapping of the deposit insurance levy, and "a modest government contribution to the costs of regulator APRA to promote efficiency."A lower tax on deposits would be funded from a higher tax on superannuation, COBA proposes.The call for a levy on systemically important banks at least bears the imprimatur of the International Monetary Fund.COBA said that "an annual levy in the range of $1 to $2 billion per annum would appear to represent a modest and conservative setting" equal to about five per cent of annual profit.In 2010, the IMF recommended that governments impose a levy on the assets of their financial institutions, a policy option followed in some countries."Our levy proposal is consistent with the observation that Australia's four major banks enjoy a funding cost advantage derived from an implicit government guarantee, and should bear some of the cost of mitigating systemic risk," COBA wrote.COBA wants the deposit insurance levy of five basis points to be dropped."The current Financial Claims Scheme insurance framework is working well, and making changes to the existing approach is not justified," it said."An ex-ante (based on forecasts) funded scheme is an inefficient solution as running any fund will be administratively expensive.""A levy on deposits will further entrench the funding advantage enjoyed by the major banks."COBA is also asking for direct funding from the Budget for APRA to the tune of more than A$40 million, about one third of the regulator's present budget (which depends on industry fees, which are, in turn, tied to asset size).