Banks target big tech in federal budget campaign
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The news: The Australian Banking Association (ABA) has called out big tech over the lack of regulation and taxation the sector faces in Australia in a lobbying blitz ahead of the May federal budget.
The numbers: The ABA has released modelling showing the banks paid a combined $16 billion in tax and other levies over the last financial year. The industry paid an additional $2.5 billion to fight financial crime and a further $700 million for community projects and disaster relief, according to the figures.
The ABA also claim banks spent $2 billion funding the New Payments Platform (NPP), $1.5 billion on the consumer data right (CDR) and $100 million on payee confirmation as part of scam protection efforts.
It argued 80 cents of every dollar of bank earnings was paid out in interest, wages and dividends.
What they said: In quantifying the industry’s contributions, ABA chief executive Simon Birmingham said the report demonstrated the “imbalance” between the banks and foreign tech companies.
“It’s Australian banks that have built our payments system and do the heavy lifting when it comes to fighting financial crime,” Birmingham said.
“Unfortunately, there is a current regulatory imbalance that is seeing global technology platforms and multinational payments firms deliver bank-like services here in Australia, without bearing proportionate regulatory and fiscal responsibilities.
“All we are calling for is a levelling of the playing field. These foreign multinationals need to be captured under the same regulatory umbrella as domestic banks, as well as more scrutiny applied to their local tax contributions.”
The context: The ABA report, titled ‘The contribution gap: tax and regulatory imbalances in the digital age’, said banks wanted the burden of regulation raised on international players which “generate revenue from Australia’s economy without making comparable contributions”.
“If this gap continues to grow unchecked, funds that bene t the Australian community through public services and superannuation will be impacted, undermining the long-term sustainability of the economy,” the report said.
It specifically called out buy now, pay later players like Klarna, Afterpay and Zip, digital wallet providers including Apple Pay, Google Pay and Samsung Pay, and large multinational payment providers including PayPal, Square, Stripe and Adyen.
It called for the federal government to better capture the sector’s tech rivals in policy and create regulatory equivalence.
The source: ABA
