Tax on bank deposits in Australia proposed

Discussion in 'Financial Cents' started by CATO, Mar 30, 2015.


  1. CATO

    CATO Monkey+++

    Can't wait until this catches on here . . . .

    Australia To Start Taxing Bank Deposits | Zero Hedge

    Up until now, the world's descent into the NIRPy twilight of fiat currency was a function of failing monetary policy around the globe as central bank after desperate central bank implemented negative and even more negative (in the case of Denmark some four times rapid succession) rates, hoping to make saving so prohibitive consumers would have no choice but to spend the fruits of their labor, or better yet, take out massive loans which they would never be able to repay. However, nobody said it was only central banks who could be the executioners of the world's saver class: governments are perfectly capable too. Such as Australia's.

    According to Australia's ABC News, the "Federal Government looks set to introduce a tax on bank deposits in the May budget."

    Ironically, the idea of a bank deposit tax was raised by Labor in 2013 and was criticized by Tony Abbott at the time. Much has changed in two years, and as ABC reports, assistant Treasurer Josh Frydenberg has indicated an announcement on the new tax could be made before the budget.

    Mr Frydenberg is a member of the Government's Expenditure Review Committee but has refused to provide any details.

    "Any announcements or decisions around this proposed policy which we discussed at the last election will be made in the lead up or on budget night," he said.

    Speaking at the Victorian Liberal State Council meeting Mr Abbott has repeated his budget message, focusing on families and small businesses.

    "There will be tough decisions in this year's budget as there must be, but there will also be good news."

    For the banks and creditors, yes. For anyone who is still naive enough to save money in the hopes of deferring purchases for the future, not so much.

    The banking industry has raised concerns about a deposit tax, saying it will have to pass the cost back onto customers.

    Steven Munchenberg from the Australian Bankers' Association said it would be a damaging move for the Government.

    "It's going to make it harder for banks to raise deposits which are an important way of funding banks. And therefore for us to fund the economy," he said. "And we also oppose it because particularly at this point in time with low interest rates a lot of people who are relying on their savings for their incomes are already seeing very low returns and this will actually mean they get even less money."

    Don't worry Steven, neither central banks nor government care about "a lot of people" - they just care about a select few. As for the banks, once China, and immediately thereafter Australia, launches QE as the entire world descends into a monetary supernova, and Australia's banks are flooded with trillions in excess reserves like those in the US, all shall be forgiven. As a reminder, banks such as JPM are so flush with zero-cost cash from other sources, well one other source, they are now actively turning away depositors.

    As for Australia, while central banks are untouchable and unaccountable to anyone (except their commercial bank directors and anyone else they secretly meet during those bimonthly sessions in the BIS tower in Basel), the government can be voted in and voted out. Especially a government that is about to break one of its main election promises:

    The Federal Opposition has accused the Government of breaking an election promise by planning to introduce a tax on bank deposits.

    The former Labor Government put forward the policy in 2013 to raise revenue for a fund to protect customers in the event of a banking collapse.

    Shadow Assistant Treasurer Andrew Leigh said Treasurer Joe Hockey criticised the proposal at the time. "When we put it on the table Joe Hockey said that it was a smash and grab on Australian households just aimed at repairing the budget," he said.

    It is almost surprising, but not really, how when it comes down to money, the thin white line between "us" and "them" always disappears when the money runs out.

    As for Australia's savers, welcome to the NIRP world where savers in increasingly more countries are now on the endangered species list.
     
    Motomom34 likes this.
  2. HK_User

    HK_User A Productive Monkey is a Happy Monkey Site Supporter

    First their guns, then their savings not far from the Ghetto stock pen mentality of Nazi Germany.
     
  3. vonslob

    vonslob Monkey++

    That is a real smart thing to do. Punish savers. When their own investment capital is all gone I guess the Chinese will step in, buy equity states and literally own the country.
     
    Motomom34 likes this.
  4. mysterymet

    mysterymet Monkey+++

    Slowly but surely remove $$ from the savings account. The $$ is better in the safe or converted into other more tangible assets.
     
  5. Tully Mars

    Tully Mars Metal weldin' monkey Site Supporter+

    I agree 100%. This is something I've been doing for awhile now. While it may be more difficult for some I think everyone should work towards it. It's funny how when you pay with cash in many places nowadays the clerk looks at you like its a big PITA for them. Many hotels will say they won't let you pay in cash, and many of the 4 star types will not, but many times I've told the desk @ check in that I'll pay in cash then pay in advance or give them a card for their file. The card, while valid is useless to them. Any work that I take on now is either a cash only(not a check) or a barter deal-my personal favorite.

    A local equipment rental business and I have an on going deal. When they need repairs done that they can't handle, I show up with the truck and do them. They keep my hours in an old fashioned ledger and apply them towards equipment rental that I have/will need. Works great for both of us. Strictly speaking I am probably losing a bit compared to getting an hourly wage for my work, but it's minimal compared to getting the kind of deal I want. If a person has skills(and almost EVERYONE has a skill of some sort) getting into the "barter economy" is just another way of preparing IMO.
     
  6. ghrit

    ghrit Ambulatory anachronism Administrator Founding Member

    Why slowly?
     
    ditch witch likes this.
  7. ditch witch

    ditch witch resident bacon hoarder Site Supporter+

    Makes Bank of Silver, Gold Cargo, and First United Mattress look a whole lot attractive
     
    Motomom34, oldawg and Tully Mars like this.
  8. mysterymet

    mysterymet Monkey+++

    If you take out too much at a time people might be interested...
     
    Cruisin Sloth and Tully Mars like this.
  9. ghrit

    ghrit Ambulatory anachronism Administrator Founding Member

    Somehow that doesn't worry me, although there are some reporting requirements in place for cash transactions, so 'tis said.
     
  10. CATO

    CATO Monkey+++

  11. VisuTrac

    VisuTrac Ваша мать носит военные ботинки Site Supporter+++

    vonslob likes this.
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