ANZ warns that staff and customers will pay for $370 million State Budget bank tax, as Rob Chapman refuses to back it

UPDATED: ONE of the banks has hinted that either its staff or its customers will pay for the banking tax announced in the State Budget, as a top Government adviser refuses to back the policy. TAKE OUR POLL

• Big banks attack South Australia’s new $370m tax
• Bank SA pulls plug on 150 jobs over new Budget levy
• A worried bank worker’s letter to Tom Koutsantonis
• Laws ‘won’t stop’ banks passing on Budget tax
• Treasurer: ‘If banks want to take us on, they can’

ANZ chief Shayne Elliott says the lender may have to cut costs or target customers in South Australia as part of efforts to stump up its share of the state’s $370 million bank tax.

In a letter to ANZ’s SA staff sent on Wednesday night, Mr Elliott lashes the new tax, saying it would “dramatically diminish” the state’s economic prospects and “sharply increase the political risk” for businesses investing there.

“This additional cost will result in either a higher cost to our customers or by needing to cut costs from our business in South Australia,” he writes.

Mr Elliott labelled the tax “immoral” and raised concerns over the legality of a state levy on liabilities outside its borders.  

Speaking at a business lunch in Sydney yesterday, Mr Elliott said he had met Premier Jay Weatherill about the tax and blasted it as “wrong. I actually think it’s immoral’’.

“There was an argument for the federal one. I don’t agree with it, but there was an argument ... There is no logical argument for a state to put a levy on the whole banking assets of the big five,” he said.

Mr Weatherill said people were upset banks made profits and closed branches. Asked if taxpayers could fund a counter campaign, he said: “We’ll do what is necessary to defend the taxation base of the state.’’

Since the tax was announced last week, Westpac has put on hold plans to build an Adelaide automated processing centre that would create 150 jobs.

Political positioning over the surprise $370 million slug on the country’s big five also gained pace, as Liberal MPs prepare for a meeting on Monday to pin down their position and the crossbench offers critical numbers needed to block the measure.

Opposition Leader Steven Marshall last week promised the tax would pass into law, but on Wednesday said: “I’m convinced this is a bad decision, and I’m gathering information.

“We’ll make a decision in our party room next Monday. It would be extraordinary for us to block this measure, but these are extraordinary times.”

Mr Weatherill on Wednesday announced a $1.6 million taxpayer grant for self-managed super fund services provider SuperConcepts to create 52 new jobs in Adelaide. It will cost more than $30,000 per position, after the money was released by Investment Attraction SA.

The agency is a State Government body headed by Adelaide Crows chairman and career banking executive Rob Chapman, who refused to back the new tax when asked.

“We’re naive to say it’s not going to have an impact. Businesses have to make decisions on the economic conditions they find themselves in,’’ he said.

Mr Chapman repeatedly refused to back the $370 million tax grab.

He has had a lengthy banking career and formerly been deputy chairman of the state’s Economic Development Board.

Adelaide Crows and Investment Attraction SA global chairman Rob Chapman.

Premier Jay Weatherill at SuperConcepts on Wednesday. Picture: AAP/David Mariuz

“It’s going to have impacts. We’re naive to say it’s not going to have an impact,” Mr Chapman said. “I’m not going to get into every Budget measure, every piece of legislation.

“Businesses have to make decisions on the current economic conditions they find themselves in.

“It’s not my job to comment on pieces of legislation and regulation. Seriously, I’m the chief of the investment attraction agency. I deal with what I’ve got. I’ve got a lot in the kit bag.”

Mr Chapman said he was surprised by the announcement in last week’s Budget.

“There are things that are going to make my job harder every single day,” he said. “I’ll deal with it, I’ll take all of that on board and can balance it up with a number of good things that go on.”

Mr Weatherill attacked the Opposition for its shifting positions on the bank tax, saying it had backtracked on a promise to approve the Budget measure following business complaints.

He also accused the banks of cutting jobs and closing branches in recent years.

Mr Weatherill said the Government was poised to combat a bank campaign against the tax.

“Most people, when they hear Westpac have closed 387 jobs here and 21 branches, and hear that they’re only paying 0.3 per cent of their profits on tax and have got out of paying the GST on financial services, most people start yawning and saying ‘yeah, that’s what we expect,” he said.

“We’ll do what is necessary to defend the taxation base of the state.

“This is in the interests of SA. We’re using this money to create jobs.”

The Opposition will debate in a party room meeting on Monday whether to block the bank tax.

The Australian Conservatives have already pledged to vote against it.

SuperConcepts chief executive Natasha Fenech said she was excited to be expanding the company’s operations in SA and “contributing to the growth of the financial services industry”.

“This agreement represents another step forward for the SuperConcepts business and will be a foundation for further growth and investment in SA,” she said.

“We will continue to invest to expand and evolve our offering to both build our presence in SA and so we can deliver greater efficiency, both for our business, and for our customers.”