The Government has chosen to make cuts to public services that ordinary working households rely upon, rather than tackling the real challenges of filling the gaps in how we tax excessive corporate profits and wealth. In particular, the failure to adopt a banking levy, supported by a majority of the public, reveals the Government’s priorities.
“The Government’s failure to advance a levy on big banks shows that the Minister of Finance is more interested in keeping the Big 4 Australian owned banks on side than reining in the excessive profits they’re taking from the NZ economy and shoring up our resilience to any future banking failures,” said Kate Stone, Better Taxes for a Better Future spokesperson.
“While the “Prudential Regulation and Supervision” measure is welcome, it will only raise $68.1m in 2027-28, which will go to the Commerce Commission, and does not address the enormous profits banks are making in New Zealand.”
“The Big 4 Australian-owned banks are making enormous profits out of NZ. Their New Zealand profits increased by 25% in real terms over the past 10 years. Meanwhile, ordinary people are struggling to put food on the table,” said Stone.
“The irony is that the Australian owned banks are paying a full bank levy in their own country, but not here. Polling we commissioned from Talbot Mills, released earlier this week, showed widespread support for a banking levy in New Zealand. So it is disappointing that the Government lacked the courage to match what the Australian Government put in place years ago.”
“If we had adopted a levy like Australia that would have generated $275-300 million, and if we’d also adopted an excess profits surcharge as in the UK that would have generated at least a further $250 million. This is revenue that could fund the cost of increasing the housing supplement, without raising the rents for social housing tenants. Or better yet, could be used to build more social housing units. The Government is leaving this much needed revenue on the table,” said Stone.